EFRAG's endorsement advice on IFRIC 22 Foreign Currency Transactions and Advance Consideration

​EFRAG has completed its due process regarding IFRIC 22 Foreign Currency Transactions and Advance Consideration and has submitted its Endorsement Advice Letter to the European Commission.

On 8 December 2016, the IASB issued IFRIC 22 Foreign Currency Transactions and Advance Consideration to
clarify how the date of the transaction should be assessed for the purpose of
determining the exchange rate to use on initial recognition of the related
asset, expense or income (or part of it) on the derecognition of a non-monetary
asset or non-monetary liability arising from the payment or receipt of advance
consideration in a foreign currency.

IFRIC 22 becomes effective for annual periods
beginning on or after 1 January 2018, with earlier application permitted. EFRAG has submitted its Endorsement Advice relating to IFRIC 22 for use in the European Union and European Economic Area. EFRAG assesses that IFRIC 22 meets all technical endorsement criteria of the IAS Regulation and is conducive to the European public good. It therefore recommends its endorsement. EFRAG's recommendation is explained in the letter to the European Commission and the accompanying appendices.

The Endorsement Advice Letter to the European Commission can be found here​.

EFRAG has also updated its Endorsement Status Report, which can be downloaded here ​​on EFRAG's web page.

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