The AcSB is participating in the International Accounting Standards Board’s (IASB) initiative to enhance IFRS 3 Business Combinations and IAS 36 Impairment of Assets in Part I of the CPA Canada Handbook – Accounting. The project aims to address the feedback from the post-implementation review of IFRS 3.
The feedback highlighted that investors find insufficient information in the financial statements to understand the performance of an acquired business. Respondents also emphasized that the goodwill impairment test might be ineffective due to untimely recognition. The proposed amendments include enhancing business combination disclosure under IFRS 3 and modifying the goodwill impairment test in IAS 36.
The AcSB’s due process includes ensuring that Canadian entities’ financial reporting needs are considered by the IASB and issuing its own exposure draft for each IASB proposal. Subject to responses to the AcSB’s exposure draft on the appropriateness of the IASB’s proposals for application in Canada, the AcSB expects to incorporate the amendments into Canadian generally accepted accounting principles in accordance with its strategy of adopting IFRS® Accounting Standards for publicly accountable enterprises.