23/02/2016 - EFRAG’s Response to the IFRS Foundation Trustees’ Invitation to Comment IFRS Taxonomy Due Process
EFRAG has published its response to the IFRS Foundation’s Invitation to Comment IFRS Taxonomy Due Process and the related feedback statement addressing the comment letters EFRAG received.
The Invitation to Comment, as published by the Trustees of the IFRS Foundation in November 2015, addresses the proposed enhanced due process for the development and maintenance of the IFRS Taxonomy. Proposed changes entail giving the IASB a role in reviewing and approving the content of the IFRS Taxonomy.
EFRAG received five comment letters on its draft comment letter which have been carefully considered in arriving at the final EFRAG letter. EFRAG has published together with its letter a feedback statement on the comments received.
EFRAG’s comment letter on the Invitation to Comment IFRS Taxonomy Due Process acknowledges the importance of the IFRS Foundation itself in continuing to develop and maintain an IFRS Taxonomy in order to control the quality of the Taxonomy and the use of the 'IFRS' brand name. EFRAG is very much supportive of the Trustees’ statement that Taxonomy considerations should not dictate the standard-setting process.
Jurisdictions that would adopt the IFRS Taxonomy as the mandatory electronic reporting format for the IFRS financial statements for their jurisdiction expect and require a robust due process and governance that gives legitimacy to the IFRS Taxonomy. EFRAG therefore proposes the establishment of a specialised committee similar to the IFRS Interpretations Committee with specific rights and obligations. The IASB would discuss and approve the strategic directions including the governing principles how to present financial statements in a structured format and considerations about the boundaries of the IFRS Taxonomy. The specialised committee composed of IFRS financial reporting experts with knowledge and expertise of taxonomies, supported by the relevant technical staff and operating within the strategic directions set by the IASB and under the oversight of the IASB, would prepare the Proposed Taxonomy Updates.
EFRAG’s Letter can be accessed here.
EFRAG’s feedback statement can be accessed here.