EFRAG requests deferral of IFRS 20 effective date
European financial reporting advisory body EFRAG has written to the International Accounting Standards Board (IASB) requesting that the effective date of the new IFRS 20 standard be pushed back by one year, from 1 January 2029 to 1 January 2030.
EFRAG’s concerns centre on preparedness, particularly for multinational companies operating across multiple jurisdictions. The letter highlights that the standard’s publication date shifted from its originally intended timeline, compressing the implementation window. It also notes that some key technical aspects of the standard, including the recognition constraint relating to whether a direct relationship exists between IFRS assets and regulatory capital base items, will only be seen in final drafted form when the standard is published, leaving preparers little time to fully assess the implications.
IFRS 20, which addresses the accounting treatment of regulatory assets and liabilities arising from rate-regulated activities, has been many years in the making. Rate regulation affects utilities, infrastructure companies and other entities whose prices are set or approved by regulators, and the standard has long been anticipated by preparers in those sectors.
The request for a one-year deferral, while modest, reflects a familiar tension in standard-setting: the gap between finalising technically complex requirements and giving the market sufficient time to implement them properly. EFRAG has noted that early adoption could remain available for those ready to move sooner.
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