EFRAG's Endorsement Advice on Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2)
On 12 February 2021, the IASB issued
Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2) (‘the Amendments’) which were initially issued as an exposure draft ED/2019/6 in August 2019.
The Amendments revise IAS 1
Presentation of Financial Statements to require entities to disclose their material accounting policy information rather than their significant accounting policies. To support this amendment, the IASB also amended IFRS Practice Statement 2
Making Materiality Judgements to explain the application of the materiality concept to accounting policy disclosures.
EFRAG’s endorsement advice, in line with the letter requesting advice received from the European Commission, only addresses the changes to IAS 1 as the Practice Statement has not been endorsed for application in the European Union.
The Amendments are effective for annual reporting periods beginning on or after 1 January 2023. Earlier application is permitted.
EFRAG has submitted its Endorsement Advice relating to the Amendments for use in the European Union and European Economic Area. EFRAG assesses that the Amendments meet the technical endorsement criteria of the IAS Regulation and are conducive to the European public good. It therefore recommends their endorsement. EFRAG's recommendation can be found 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.