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Non-financial liabilities

Background

This project originated in conjunction with, and as part of, the wider IASB-FASB convergence project on business combinations.  An important objective is alignment of the requirements for recording costs of restructuring activities with those in US GAAP, and alignment of the criteria for recording liabilities with the criteria in other IFRSs. The project also aimed to provide more specific requirements on measuring the liabilities within the scope of IAS 37 Provisions, Contingent Liabilities and Contingent Assets.

On reactivating this project as an IASB-only project in December 2012, the IASB confirmed it will not amend IAS 37 without a full re-exposure.  The reactivated project will focus on identifying examples that are continuing to cause difficulty in applying IAS 37 in practice.  These examples will initially be used as 'test cases' in developing the elements and measurement chapters of the comprehensive conceptual framework project.

 

Current status of the project

During their joint meeting in November 2010, the IASB and FASB decided to defer further work on this project. In December 2012, as part of its response to the Agenda consultation 2011, the IASB formally reactivated this project as an IASB-only research project.

 

Project milestones

DateDevelopmentComments
April 2002 Added to the active agenda
30 June 2005 ED Amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets and IAS 19 Employee Benefits issued Comment deadline 28 October 2005
9 November 2005 Public roundtable discussions
Fourth quarter 2006 Roundtables on liabilities held
10 January 2008 IASB releases standards on business combinations Included consequential amendments to related standards
5 January 2010 Exposure Draft ED/2010/1 Measurement of Liabilities in IAS 37 published Original comment deadline 12 April 2010, extended to 19 May 2010
7 April 2010 Staff Paper Recognising liabilities arising from lawsuits published
December 2012 Reactivated as an IASB-only research project Outcomes to be incorporated into the elements and measurement chapters of the Conceptual Framework

Related Discussions

  • IAS 37 — Inclusion of own credit risk in discount rate

  • Mar 10, 2011

  • The Interpretations Committee received a request for interpretation of the phrase ‘the risks specific to the liability’ and whether this means that an entity’s own credit risk (performance risk) should be excluded from any adjustments made to the discount rate used to measure liabilities.

  • Post-employment benefits

  • Jan 21, 2011

  • The IASB (1) reconsidered an earlier tentatively decision to retain the option of presenting the remeasurement component in either profit or loss or other comprehensive income (2) interactions between the projects on IAS 19 and IAS 37.

  • Liabilities – IFRS to replace IAS 37

  • Nov 16, 2010

  • The IASB considered possible revisions to the recognition requirements for non-financial liabilities as a result of comments received on the working draft of the IFRS. Topics included (1) the threshold for the existence of a liability (2) additional guidance and examples on how entities should apply the recognition criteria if there is uncertainty as to whether a liability exists (3) removal of 'probable outflows' criterion.

  • Liabilities — Amendments to IAS 37

  • Sep 15, 2010

  • The staff presented to the IASB an analysis of the responses received on the exposure draft on the measurement of liabilities, summarising the key issues identified by constituents.

  • Liabilities (IAS 37)

  • Aug 26, 2010

  • European standard-setter representatives raised the IAS 37 project as continuing to be on concern, particularly the removal of the probability threshold and measurement at expected value.

  • Impairment

  • Jul 23, 2010

  • The IASB (1) considered a staff analysis of comment letters on the Exposure draft ED/2009/12 'Financial Instruments: Amortised Cost and Impairment' (2) considered a summary of the deliberations of the Expert Advisory Panels.

  • Liabilities: Replacement of IAS 37

  • Mar 19, 2010

  • The Board considered requests from constituents to extend the comment period for the exposure draft Measurement of Liabilities in IAS 37.

  • IAS 37 Measurement

  • Dec 15, 2009

  • The Board plans to publish an exposure draft (ED) on the revised proposals for the measurement of liabilities in IAS 37.

  • Liabilities - Amendments to IAS 37

  • Nov 19, 2009

  • The Board discussed how to resolve a conflict identified by the staff. Previously, the Board decided to clarify that entities should measure liabilities in the scope of IAS 37 by reference to the value, rather than the cost, of the outflows required to fulfil the obligation.

  • Liabilities — Amendments to IAS 37

  • Oct 21, 2009

  • The staff presented one issue to the Board: whether re-exposure of the IAS 37 amendments package was necessary or whether the Board could proceed directly to issue an IFRS.

  • Liabilities — Amendments to IAS 37

  • Sep 16, 2009

  • The Board discussed the details of the measurement guidance for service obligations. The issue was discussed on the July meeting when several Board members expressed their concerns regarding the earlier tentative decision.

  • Liabilities — Amendments to IAS 37

  • Jul 22, 2009

  • Staff presented a paper proposing more detailed specification of the measurement objective underpinning the proposed measurement guidance for IAS 37. The objective is to facilitate the use of the IAS 37 measurement model for other types of liabilities (for example, insurance).

  • Liabilities — Amendments to IAS 37

  • Jun 17, 2009

  • The Board discussed concerns raised by some constituents and Board members that defendants in some legal proceedings might encounter practical problems when applying aspects of the proposed amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets.

  • Liabilities: Amendments to IAS 37

  • Dec 16, 2008

  • The Board discussed whether specific disclosure requirements were required in the revised version of IAS 37 with respect to possible obligations – those matters that do not meet the definition of a liability (currently called 'contingent liabilities') – and whether the notes to the financial statements should contain details of situations in which it is uncertain that a present obligation exists and the entity has judged that none does.

  • Liabilities — Amendments to IAS 37

  • May 22, 2008

  • The staff presented an analysis of the comments received on the exposure draft relating to the proposed amendments to IAS 19 Employee Benefits.

  • Liabilities — Amendments to IAS 37

  • Apr 16, 2008

  • The IASB staff introduced the first draft of possible application guidance to accompany the measurement requirements of proposed revisions to IAS 37 Provisions, Contingent Liabilities and Contingent Assets.

  • Liabilities — Amendments to IAS 37

  • Feb 21, 2008

  • The Board continued its deliberation regarding the measurement requirements and the removal of the probability recognition criterion in the Exposure Draft of Proposed Amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets and IAS 19 Employee Benefits (the ED).

  • Liabilities — Amendments to IAS 37

  • Dec 13, 2007

  • The IASB staff presented a paper to the board discussing comments received in relation to the measurement proposals in the IAS 37 Exposure Draft.

  • Liabilities — Amendments to IAS 37

  • Jul 20, 2007

  • The purpose of this session was summarise the current status of the project, to identify unresolved issues and to agree on the extent of further work required on these topics in the IAS 37 project.

  • Liabilities — Amendments to IAS 37

  • May 17, 2007

  • The Board continued its deliberations on distinguishing uncertainty about the existence of a present obligation from a stand-ready obligation.

  • Liabilities — Amendments to IAS 37

  • Apr 19, 2007

  • Representatives from the legal profession met with the Board to discuss issues particularly associated with applying the proposals in the IAS 37 ED to lawsuits.

  • Liabilities — Amendments to IAS 37

  • Mar 20, 2007

  • The Board continued its redeliberations of the proposed amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets, concentrating on the distinction between a liability and a business risk, and the definition of a 'stand ready obligation'.

All Related