Your fortnightly technical updates newsletter (21 July 2021)

Standard setting

July IFRS Interpretations Committee podcast

The July IFRS Interpretations Committee podcast, highlighting the committee’s key activities at its July meeting, is now available.

Recording of the IASB second webinar on BCUCC discussion paper

A recording is now available of the International Accounting Standards Board (IASB) second webinar on the Discussion Paper DP/2020/2 Business Combinations under Common Control (BCUCC), which discussed feedback the IASB received in the initial outreach activities and addressed some of the frequently asked questions from stakeholders.

Recording of the IASB webinar on Request for Information Third Agenda Consultation

A recording is now available of the webinar on the IASB Request for Information Third Agenda Consultation, which seeks public views on what the IASB’s priorities should be over the next five years. This webinar provided an overview of the agenda consultation and addressed questions from participants. Members can also submit comments to the Institute by 10 August.

Recording of the joint research workshop on IASB exposure draft on disclosure requirements in IFRSs

A recording of the virtual research workshop held by the IASB, in conjunction with the European Accounting Association and the European Financial Reporting Advisory Group, is now available. The workshop provided an overview of the IASB Exposure Draft ED/2021/3 Disclosure Requirements in IFRS Standards—A Pilot Approach that sets out the IASB’s proposals in developing disclosure requirements in IFRSs and new disclosure requirements for IFRS 13 Fair Value Measurement and IAS 19 Employee Benefits. Members can also submit comments to the Institute by 31 August.

Webinar on the Financial Reporting Council inspection findings

Join the webinar on 29 July to learn the Financial Reporting Council's (FRC) inspection findings from its 2020 inspections, the FRC's expectations for auditors, preparers and audit committee members of public interest entities, and areas of focus for 2021 inspections.

Webinars on quality management standards

The International Auditing and Assurance Standards Board (IAASB) and the International Federation of Accountants (IFAC) will hold a series of webinars on International Standard on Quality Management 1, Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements, including question and answer sessions. Recordings will be available on the IAASB’s YouTube channel following the sessions. Register now: 29 Jul, 5 Aug, 18 Aug.

The recording from the first webinar of this series, Your Firm’s Risk Assessment Process, is now available.

IAASB June board meeting

The meeting highlights of the IAASB June board meeting is now available.

Exploring the impact of disruptive technology

Technological changes affect auditors and audited entities and can cause significant disruption. A summary of the IAASB’s work exploring how the board could respond appropriately to support audit quality and how it leverages technology to improve its own standard-setting activities is available on its Technology focus area webpage. A summary of the disruptive technologies' roundtable is also available in the meeting papers from January 2021.

Recordings of the IFRS Foundation Trustees webinars on its sustainability project

Recordings are now available of the IFRS Foundation Trustees webinars on its project setting up an International Sustainability Standards Board.

IFRS Foundation response to G20 finance ministers’ and central bank governor’s’ communique regarding global sustainability standards

The IFRS Foundation provided comments on the communique issued by the G20 finance ministers and central bank governors that referenced ongoing work of the Trustees to consider the formation of a new sustainability board within the governance structure of the IFRS Foundation.

Recording of the panel debate from the G20 Venice conference

A recording is now available of the panel debate on regulations, disclosures, financial risk and private financing for the green economy from the G20 Venice conference. The panel debate featured the IFRS Foundation Trustee Chair Erkki Liikanen, and was organized by the Italian Ministry of Economy and Finance and the Bank of Italy to coincide with the G20 Finance Ministers and Central Bank Governors’ meeting.

A4S launches Navigating the Reporting Landscape

With the awareness of environmental and social issues increasing, sustainability reporting is shaping the future of business reporting. To help finance professionals stay updated, the Prince’s Accounting for Sustainability Project’s Accounting Bodies Network (ABN), of which the Institute is a member, has published Navigating the Reporting Landscape. The guide sets out how the corporate reporting landscape is changing, and how these developments are impacting the role of the accountant.

Introduction to the Value Reporting Foundation

The International Integrated Reporting Council (IIRC) and the Sustainability Accounting Standards Board (SASB) merged to form the Value Reporting Foundation. In this video Janine Guillot, the CEO of the foundation, discusses the new body and the global reporting landscape.

Advocacy and practice development

Best Corporate Governance and ESG Awards 2021 opens for entry

The Institute has launched the revamped Best Corporate Governance and ESG Awards, previously known as Best Corporate Governance Awards. The Awards are now open for entry until 9 August.

The revamped Awards aim to reflect the increasing importance of environmental, social and governance (ESG) reporting, and to encourage companies and organizations to integrate the oversight and implementation of their corporate governance (CG) and ESG, as well as uplift the standards of disclosure and practices in both areas.

The top accolades in this year’s Awards will be for the Most Sustainable Companies/ Organizations. These will be presented to listed companies and public sector/ not-for-profit organizations that demonstrate excellence in both CG and ESG practices, with equal weight being allocated to these two areas, as they move towards fuller integration of these two key aspects of reporting.

More details about the awards, and how to enter them can be found on the website.

Findings of brief research on ESG assurance of Hang Seng Index companies

To better gauge current practice in ESG assurance, the Institute recently conducted research on the status of the 49 Hang Seng Index constituent (HSI) companies that had published their sustainability/ ESG report, or incorporated a sustainability/ ESG section in their annual report for 2020/21, as at 28 June. Of these companies, 23 also sought external assurance on the information disclosed. The research found that the assurance provider and the scope of information assured varied among companies. Click here for further information.

We will be conducting a similar research on all the December year-end listed companies for 2020/21 and will share the findings in due course.

Transitioning away from LIBOR

The Hong Kong Monetary Authority (HKMA) and the Treasury Markets Association recently issued a leaflet reminding corporate treasurers to make suitable preparations for the transition away from LIBOR as an interest rate benchmark. Further information can be found on the HKMA’s website.

Implications of the government’s Consumption Voucher Scheme for provisional trustees under the Bankruptcy Ordinance

Disbursement of the government’s HK$5,000 Consumption Voucher Scheme, begins soon. The Official Receiver’s Office (ORO) issued a letter to the Institute on 2 July, aimed at members who are insolvency practitioners and appointment takers, acting as the joint and several provisional trustees/ trustees under the Bankruptcy Ordinance. The letter advises on factors that should be considered in determining whether or not it would be appropriate to lay claim to the vouchers received by an undischarged bankrupt as after-acquired property.

The ORO reminds officeholders that they should not apply an across-the-board decision to all cases. They are encouraged to exercise their professional judgement and use flexibility and discretion when assessing the basic domestic needs of bankrupts and their families, particularly at this time, given the impact of the pandemic.

Electronic filing of Profits Tax Returns

Corporations and partnerships satisfying the conditions specified by the Commissioner of Inland Revenue can file their Profits Tax Returns for any year of assessment from 2015/16 to 2020/21 and attach supplementary forms to Profits Tax Return S1, S2, S3 and S4 electronically through eTAX. Please visit the Inland Revenue Department's (IRD) website for details.

Announcements by the Inland Revenue Department

Members may wish to be aware of the following matters:

Announcements by the government

Members may wish to be aware of the following matter:

Gazettal of Personal Data (Privacy) (Amendment) Bill 2021 which aims to combat doxxing.

AML notices

United Nations Sanctions (Libya) Regulation 2019 (Amendment) Regulation 2021 was gazetted on 9 July.

For the current lists of terrorists, terrorist associates and relevant persons/ entities subject to United Nations sanctions, members should refer regularly to the Institute's AML webpage. Other useful documents and guidance can also be found on the same page.

Useful resources

Publications from other organizations:

Beyond sustainability reporting: Embedding ESG in strategy from Financial Management
Why do so many strategies fail? from Harvard Business Review
At 2021’s midpoint, what’s on the minds of CFOs? from Journal of Accountancy
Why cryptocurrency transactions matter from CFO.com

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