Proposed clarifications to IFRS 15 published

Keywords: Mazars, Thailand, IFRS, IASB, GAAP, FASB, TRG

12 October 2015

Readers will be unsurprised to learn that these clarifications pertain to the following issues, previously discussed by the TRG:

• Identifying the performance obligations in a contract (changes made to the illustrative examples – see the February 2015 issue of Beyond the GAAP);
• Distinguishing between an agent and a principal (amendments to the standard and changes/additions to the illustrative examples – see the May and June 2015 issues of Beyond the GAAP);
• The nature of rights provided by a licence: a right to access or a right of use (amendments to the standard and changes/additions to the illustrative examples – see the February 2015 issue of Beyond the GAAP);
• Changes to the transition requirements with the addition of two new reliefs (see the March 2015 issue of Beyond the GAAP).

As noted in our previous updates, the IASB and its US counterpart, the FASB, did not always reach the same conclusions on the changes to be made to the standard as originally published. Therefore, the Basis for Conclusions on the IASB’s exposure draft summarises each Board’s reasoning on the above topics, as well as listing the topics addressed by the FASB but not the IASB. (These are as follows: collectability when identifying a contract in Step 1 of the new revenue recognition model; measuring the value of non-cash consideration; and presentation of sales taxes in the statement of comprehensive income.) The IASB is seeking comments from stakeholders on its proposed amendments.

If adopted, these amendments will be applicable retrospectively, and the effective date will probably be the same as the new effective date for IFRS 15 (see next item). In practice, these amendments would thus be implemented from the transition date as if they had always formed part of the standard.

The comment period closes on 28 October 2015, as the IASB hopes to finalise the amendments by the end of the year.

The exposure draft is available on the IASB’s website.