Due Process Compliance Statement - Supplier Finance Arrangements
| Title of the Amendment | Issue dates |
|---|---|
| Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7) | - Exposure Draft ED/2021/10 issued: 26 November 2021. - Final amendments issued: 25 May 2023. - Effective for annual reporting periods beginning on or after 1 January 2024. Earlier application is permitted. |
General UKEB requirements: The UKEB adopts international accounting standards for use within the UK, in accordance with SI 2019/685, and applies its own processes before it decides whether to adopt a new or amended international accounting standard.
Endorsement process
Work plan [Handbook 4.30(d)]
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Technical project added to UKEB technical work plan | Mandatory | Project is included in the UKEB published technical work plan | Complete: the Amendments were included in the UKEB technical work plan published in May 2023. |
Project preparation [Handbook 6.12-6.16]
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Project Initiation Plan (PIP) | Mandatory | PIP with draft project outline (background, scope, project objective) and approach for endorsement and adoption (key milestones and timing) proportionate to the project. | Complete: Taking a proportionate approach, the PIP included mandatory milestones for the project and considered, as appropriate, other milestones and activities. The PIP was approved at the 18 May 2023 Board meeting. |
| Outreach plan for stakeholders and communication approach outlined | Mandatory | Outreach plan for stakeholders and communication approach outlined | Complete: Due to the narrow-scope of the Amendments, consultation activities were focused on obtaining responses to the Draft Endorsement Criteria Assessment (DECA) as well as consulting with UKEB advisory groups and limited targeted outreach with relevant UK stakeholders, including some who had previously provided feedback to the IASB and/or UKEB. The PIP (referred to above) included the outreach plan and approach. |
| Resources allocated | Mandatory | Resources allocated | Complete: One Project Director supported by a Project Manager, with oversight provided by one Senior Project Director and with communications and economics team support. |
| Assessment of whether to set up an ad-hoc advisory group | Mandatory | Assessment of whether to set up an ad-hoc advisory group | Complete: Assessed. The narrow-scope of the Amendments meant that setting up an ad-hoc advisory group was not considered to be proportionate approach. |
| UKEB Board public meeting held to approve PIP | Mandatory | UKEB Board public meeting held to approve PIP | Complete: The PIP was approved at the 18 May 2023 Board meeting. |
| UKEB education or initial assessment | Optional | UKEB education or initial assessment | Complete: The Board received an education session on the Exposure Draft of the Amendments in December 2021. The Board was provided with updates on the IASB redeliberations at its December 2022, February 2023 and March 2023 Board meetings. |
Communications
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Public board meetings [Handbook 4.10] | Mandatory | UKEB Board public meetings held to discuss technical project. | Complete: The Board approved the Project Initiation Plan (PIP) at its 18 May 2023 meeting. It approved the draft ECA for consultation at its 13 July 2023. An update on stakeholder feedback received on the DECA was provided to the Board at its 19 October 2023 meeting. The Board approved the Adoption Package, consisting of the final Endorsement Criteria Assessment (ECA), the Feedback Statement, the [draft] Due Process Compliance Statement (DPCS) and the [draft] Adoption Statement for the Amendments, at its meeting on 16 November 2023. The final DPCS was presented for noting at the Board's 14 December 2023 meeting. |
| Secretariat papers [Handbook 4.20] | Mandatory | Board meeting papers posted and publicly available on a timely basis. | Complete: The UKEB's meeting papers were published on the UKEB website one week before the public meetings. Meeting minutes and recordings were made publicly available via the UKEB website. Subscribers notified via UKEB News Alerts |
| Project webpage [Handbook 4.25(b)] | Mandatory | Project webpage contains a project description with up-to-date information on the project. | Complete: A webpage was created containing key project information. |
| Update UKEB webpage | Mandatory | Update UKEB webpage | Complete: The project webpage has been updated regularly on a timely basis. |
| Subscriber alerts [Handbook 4.24] | Mandatory | Evidence that subscriber alerts have occurred | Complete: Subscribers were alerted via email 5 working days before each Board meeting, with links to the agenda, papers and the option to dial in to observe the discussion. News Alerts were also issued, alerting subscribers to the publication of the DECA and adoption of the Amendments. |
| Project email address | Mandatory | Project email address | A general UKEB email address was used for outreach and correspondence purposes throughout the duration of the project. |
Desk-based research [Handbook 6.17]
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Desk-based research | Optional | Identify relevant research sources and documents | Complete: the Secretariat has reviewed: - The IASB's work on the Amendments, mainly the IASB's Exposure Draft (ED) including its Basis for Conclusions, the IASB staff papers and a related IFRIC Agenda Decision; - Comment letters on the ED received by the IASB from UK stakeholders including the UKEB; - Previous work done by the UKEB (including early desk-based research and comment letters on the UKEB Draft Comment Letter); - Relevant material produced by other parties (including accounting firms and the FRC, such as a CRR Thematic Review and a report from The Lab); - Other standard-setters' views; and - The IASB's final Amendments. |
Outreach activities [Handbook 6.18-6.22]
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Consult with a representative range of stakeholders before adoption | Mandatory | Evidence of consultation | Due to the narrow-scope nature of the Amendments, consultation activities were focused on obtaining responses to the Draft Endorsement Criteria Assessment (DECA), consultation with UKEB advisory groups and limited targeted outreach with relevant UK stakeholders, including some who had previously provided feedback to the IASB and/or UKEB. A summary of outreach activities is presented in the Feedback Statement. The UKEB received eight formal comment letters in response to its Invitation to Comment. All comment letters received were published on the UKEB website. |
Draft Endorsement Criteria Assessment (DECA) [Handbook 6.23-6.29]
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| UKEB sets comment period for response on DECA (generally not less than 90 days) | Mandatory | UKEB sets comment period for response on DECA (generally not less than 90 days) | Complete: At its May 2023 meeting the Board decided that the DECA would be issued for comment for 90 days and approved the overall project plan. The DECA was published for consultation for 90 days on 20 July 2023 (comment period deadline: 18 October 2023). |
| Review and approval at UKEB public meeting | Mandatory | Review and approval at UKEB public meeting | Complete: The DECA was reviewed and approved at the Board meeting on 13 July 2023. |
| DECA posted on website for public consultation | Mandatory | DECA posted on website for public consultation | Complete: The Secretariat published the approved DECA and Invitation to Comment on the UKEB website for a 90-day consultation period from 20 July 2023 to 18 October 2023. |
| News Alert to announce publication | Mandatory | News Alert to announce publication | Complete: A News Alert was published on 20 July 2023 calling for comments. Additional communications were shared by the FRC on behalf of the UKEB. A link to the DECA was sent out to UKEB advisory groups (Accounting Firms and Institutes Advisory Group, Investor Advisory Group and Preparer Advisory Group) and to the UKEB Financial Instruments Working Group. |
Project finalisation and project closure [Handbook 6.30-6.48]
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Public responses on DECA assessed and posted on website | Mandatory | Public responses on DECA assessed and posted on website | Complete: The UKEB received eight comment letters which were published on the UKEB website. All responses were assessed, reflected as appropriate in the final ECA and summarised in the Feedback Statement. |
| Final Endorsement Criteria Assessment (ECA) approved by UKEB in public meeting | Mandatory | Final ECA approved by UKEB in public meeting | Complete: A draft of the final ECA was presented for approval to the Board at its 16 November 2023 public meeting. The Board approved the final ECA, at that meeting. |
| Publish final ECA on UKEB website | Mandatory | Publish final ECA on UKEB website | Complete: The final ECA was published on the UKEB website on 30 November 2023. |
| Feedback statement approved by UKEB in public meeting | Mandatory | Feedback statement approved by UKEB in public meeting | Complete: A draft of the Feedback Statement was presented for approval to the Board at its 16 November 2023 public meeting. The Board approved the final Feedback Statement, subject to editorial changes. |
| Feedback statement posted on UKEB Website | Mandatory | Feedback statement posted on UKEB Website | Complete: The final Feedback Statement was published on the UKEB website on 30 November 2023. |
| News Alert published to announce | Mandatory | News Alert published to announce | Complete: A News Alert announcing publication of the adoption of the Amendments was published on 30 November 2023. |
Due Process Compliance Statement (DPCS)
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Due Process Compliance Statement approved by UKEB in public meeting | Mandatory | Due Process Compliance Statement approved by UKEB in public meeting | Complete: A draft DPCS was presented for approval to the Board at its 16 November 2023 public meeting. The final DPCS was presented for noting at the Board's 14 December 2023 meeting. |
| Due Process Compliance Statement posted on UKEB Website | Mandatory | Due Process Compliance Statement posted on UKEB Website | Complete: The final DPCS was published on the UKEB website subsequent to the 14 December 2023 Board meeting. |
Adoption Statement
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Adoption statements approved by UKEB in public meeting | Mandatory | Adoption statements approved by UKEB in public meeting | Complete: The Adoption Statement for the Amendments was approved by the Board at its 16 November 2023 public meeting. |
| Adoption statements posted on UKEB Website | Mandatory | Adoption statements posted on UKEB Website | Complete: The final Adoption Statement for the Amendments was published on 30 November 2023. |
| News Alert published to announce publication | Mandatory | News Alert published to announce publication | Complete: The News Alert announcing adoption of the Amendments was published on 30 November 2023. |
Voting on adoption of the Amendments
| Step | Mandatory/optional1 | Metrics or evidence | UKEB Secretariat comments |
|---|---|---|---|
| Tentative vote | Mandatory | Tentative vote | Complete: Tentative vote took place at the 16 November 2023 Board meeting based on the discussion of the Adoption Package, which included the final draft ECA, the Feedback Statement, the DPCS, the draft Adoption Statement for the Amendments and the text of the UK-adopted international accounting standard (Supplier Finance Arrangements Amendments to IAS 7 and IFRS 7). The vote was indicative only. |
| Evidence of written vote (in paper or electronic form). | Mandatory | Evidence of written vote (in paper or electronic form). | Complete: The Adoption Statement and voting forms were sent to the Board for voting (accompanied by the text of the Amendments to be adopted) on 21 November 2023 (written forms due by noon 28 November 2023). The vote was formalised by Board members signing the formal voting forms for the Amendments. |
| News Alert published to announce the outcome of the vote within 3 working days of the formal vote | Mandatory | News Alert published to announce the outcome of the vote within 3 working days of the formal vote | Complete: The announcement of the adoption of the Amendments was published on the UKEB website on 30 November 2023. The News Alert announcing adoption of the Amendments was published on 30 November 2023. |
Conclusion
This document sets out the main due process activities performed as part of the UKEB's project to endorse the Amendments.
In the Board's opinion, overall, this project complies with the applicable due process steps, as set out in the Handbook at the time of writing.