IASB proposes annual improvements, change to investment property standard

By Ken Tysiac

The International Accounting Standards Board (IASB) published two exposure drafts Thursday, proposing a narrow-scope amendment to its investment property standard and amendments to three other standards as part of its annual improvements process.

The board is proposing a narrow-scope amendment to Paragraph 57 of IAS 40, Investment Properties, which provides guidance on transfers to, or from, investment properties. The paragraph currently does not specifically address whether a property under construction or development that was previously classified as inventory could be transferred to investment property when there is an evident change in use.

Under the proposal, Paragraph 57 of IAS 40 would be amended to:

  • State that an entity shall transfer a property to, or from, investment property when and only when there is a change in use of property supported by evidence that a change of use has occurred; and
  • Recharacterize the list of circumstances set out in Paragraph 57(a)–(d) as a nonexhaustive list, instead of an exhaustive list, of examples of evidence that a change in use has occurred.

Comments on the proposed investment properties guidance are due March 18 and can be submitted at the IASB’s website.

The IASB also published an ED, Annual Improvements to IFRSs 2014-2016 Cycle, which proposes amendments to three standards:

  • IFRS 1, First-time Adoption of International Financial Reporting Standards;
  • IFRS 12, Disclosure of Interest in Other Entities; and
  • IAS 28, Investments in Associates and Joint Ventures.

Comment on this ED is due Feb. 17 at the IASB’s website. The proposals in the annual improvements ED are the result of the IASB’s process for dealing efficiently with wording clarifications and issues related to inconsistency in application of standards.

Ken Tysiac (ktysiac@aicpa.org) is a JofA editorial director.

SPONSORED REPORT

Revenue recognition: A complex effort

Implementing the new standard requires careful judgment. Learn how to make significant accounting judgments and document them and collaborate with peers for consistent application.

TECHNOLOGY Q&A

How to create maps in Excel 2016

Microsoft Excel 2016 has two new mapping capabilities. J. Carlton Collins, CPA, demonstrates how to make masterful 2D and 3D maps in Excel 2016.

QUIZ

News quiz: Economy and health care changes top CPAs’ list

CPA decision-makers’ economic outlook and the House Republicans’ proposed tax changes as part of replacing the Patient Protection and Affordable Care Act received attention recently. See how much you know with this short quiz.