Highlights
The Accounting Standards Board (AcSB) proposes, subject to comments received following exposure, to incorporate into Part I of the CPA Canada Handbook – Accounting, amendments to International Accounting Standard (IAS 21) The Effects of Changes in Foreign Exchange Rates.
This AcSB Exposure Draft, “Translation to a Hyperinflationary Presentation Currency,” reflects the proposals made by the International Accounting Standards Board (IASB) and the AcSB intends to adopt, subject to deliberating comments received, as Canadian generally accepted accounting principles.
Comments are requested from individuals and organizations in Canada who agree with the Exposure Draft proposals, as well as from those who do not. Comments are most helpful if they relate to a specific paragraph or group of paragraphs. Any comments that express disagreement with the proposals should clearly explain the problem and include a suggested alternative, supported by specific reasoning.
Comments received on the AcSB Exposure Draft will be available on the website shortly after the comment deadline unless confidentially is requested. The request for confidentially must be stated explicitly within the response.
IASB® Exposure Draft
The IASB recently issued the Exposure Draft, “Translation to a Hyperinflationary Presentation Currency,” which proposes amendments to IAS 21, and is available on the IASB website at www.ifrs.org/.
The IASB’s Exposure Draft proposes a narrow-scope amendment aimed to provide guidance on the translation of amounts from a functional currency that is the currency of a non-hyperinflationary economy to a presentation currency that is the currency of a hyperinflationary economy.
In the situation referred to above, the IASB’s Exposure Draft proposes that an entity translates those amounts, including comparative amounts, using the closing rate at the date of the most recent statement of financial position.
The IASB’s Exposure Draft includes Basis for Conclusions, as well as proposed amendments to the forthcoming IFRS 19 Subsidiaries without Public Accountability: Disclosures. This material may provide useful information to interested and affected parties.
Comments Requested
The AcSB encourages interested and affected parties in Canada to respond to the IASB on its Exposure Draft. Specific questions on which the IASB would like input are provided in the Invitation to Comment in its Exposure Draft. The AcSB requests that comment letters be sent directly to the IASB with a copy to the AcSB.
The AcSB is not planning to respond to the IASB’s Exposure Draft, as this issue is not widespread for Canadian entities. If you think the AcSB should respond, or you have any comments on the additional question below, you are encouraged to respond directly to the AcSB.
The IASB has developed the proposed amendments in accordance with its due process for application around the world. Assuming the Exposure Draft proposals are finalized and approved by the IASB in accordance with its due process, do you think that the proposals are appropriate for application in Canada? If not, please specify which aspects of the proposals, as well as what circumstances, make the accounting requirements proposed in the Exposure Draft inappropriate.