Surveying the reporting landscape and looking ahead at the IFRS Foundation Conference
The recent IFRS Foundation Conference 2022 addressed key current and emerging themes in the reporting arena.
Day 1 addressed sustainability matters, with the first keynote coming from Ashley Alder, International Organization of Securities Commissions (IOSCO) Board Chair and CEO of the Securities and Futures Commission of Hong Kong. He discussed IOSCO’s potential endorsement of the sustainability reporting standards being developed by the International Sustainability Standards Board (ISSB), as well as key challenges for implementation.
Among IOSCO’s main criteria for assessment, the ISSB standards should be compatible and connected with existing accounting and financial reporting standards; they should act as a common base for jurisdiction-level requirements, making them interoperable with one another using a building blocks approach; and they should provide the necessary consistency to enable markets to reliably price sustainability-related risks and opportunities. The overall aspiration, he said, is to bridge the divide between conventional financial disclosures and ISSB sustainability disclosures centred on the concept of enterprise value, so that in combination they paint the full picture.
A second keynote was given by ISSB Chair Emmanuel Faber, highlighting the significant progress made by the ISSB so far, including the draft standards now under public consultation. Connectivity between the ISSB and the International Accounting Standards Board (IASB) was a dominant theme in the panel discussion that followed, while the final panel of the day explored how technology is changing the way investors consume financial reports and make investment decisions, and its importance in the efficient provision of both financial and sustainability-related information – a discussion we look forward to seeing more of.
Day 2 was dedicated to financial accounting. During his keynote, Chair Andreas Barckow discussed the outcomes of IASB’s Agenda Consultation for 2022–26. Over the next five years, he announced, IASB will principally be focussed on completing its current work plan. It has decided to add only two projects to its research pipeline, on intangible assets and the statement of cash flows, while one additional maintenance project on climate-related risks in financial statements also joins the work plan. He too returned to the theme of connectivity, promising that the IASB and ISSB will work collegiately and efficiently together. “The Foundation is now in the exceptionally good place, arguably a unique one, of having two boards that can look into the entirety of standardising financial reporting and connecting the information for the benefit of investors and other capital market participants.”