2015 IFRS Foundation Trustees' Invitation to Comment IFRS Taxonomy Due Process
- Saskia Slomp
In November 2015, the IFRS Foundation Trustees published their Invitation to Comment IFRS Taxonomy Due Process with a comment deadline by 3 February 2016. The Invitation to Comment addresses the proposed enhanced due process for the development and maintenance of the IFRS Taxonomy. The proposed changes entail giving the IASB a role in reviewing and approving the content of the IFRS Taxonomy.
The development and maintenance of the IFRS Taxonomy, which enables accurate and consistent electronic reporting of IFRS financial statements, was a supporting activity under the IFRS Foundation until 2011, when it became part of the IASB's work.
The Trustees of the IFRS Foundation published in July 2015 a request for views on their latest review of the structure and effectiveness of the IFRS Foundation, This request for views incorporates specific questions on the role of technology and the IFRS Taxonomy.
On 4 December 2015 EFRAG issued its draft comment letter on the IFRS Foundation Trustees' Invitation to Comment IFRS Taxonomy Due Process with a deadline for comment by 30 January 2016.
EFRAG received five comment letters 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 acknowledges the importance of the IFRS Foundation itself 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 supports the IFRS Foundation’s goal of having the IFRS Taxonomy recognised as the globally agreed standard to tag and intelligently structure IFRS financial information within a digital report. EFRAG is very much supportive of the Trustees’ statement that Taxonomy considerations should not dictate the standard-setting process.
EFRAG is of the opinion that proposals for changes to the IFRS Taxonomy due process and notably the role of the IASB Board and the IFRS Taxonomy Review Panel in approving the IFRS Taxonomy content updates reflecting new or amended IFRS, could constitute a risk of the IFRS Taxonomy having a too prominent role.
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.
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.
03/12/2015 - EFRAG's Draft Comment Letter to the IFRS Foundation Trustees' Invitation to Comment IFRS Taxonomy Due Process
EFRAG has published its draft comment letter on the IFRS Foundation's Invitation to Comment IFRS Taxonomy Due Process and seeks constituents' views. Comments on our draft comment letter are requested by 30 January 2016.