Our Ref.: C/FRSCSent electronically through the IASB Website (www.ifrs.org)
15 August 2019Mr Hans HoogervorstInternational Accounting Standards BoardColumbus Building7 Westferry CircusCanary WharfLondon E14 4HDUnited KingdomDear Hans,IASB Exposure Draft ED/2019/2 Annual Improvements to IFRS Standards 2018-2020The Hong Kong Institute of Certified Public Accountants is the only body authorised bylaw to set and promulgate standards relating to financial reporting, auditing, and ethics forprofessional accountants, in Hong Kong. We are grateful for the opportunity to provideyou with our comments on this Exposure Draft.We welcome the IASB's annual improvements to make necessary, but non-urgent,amendments to IFRS Standards that address inconsistencies in the application ofStandards and clarify the wording in a Standard.We have comments on the proposed amendments to the following Standards:
IFRS 9 Financial InstrumentsWe support the IASB's proposal to clarify the fees that an entity includes in assessingwhether the terms of a new or modified financial liability are substantially different fromthe terms of the original financial liability.Some Stakeholders in the banking industry also request to clarify in paragraph B3.3.6 ofIFRS 9 whether fees/amounts paid to cover fair value changes are to be included in thecalculation. They also suggest similar clarification be made in paragraph 5.4.3 of IFRS 9.Illustrative Examples accompanying IFRS 16 LeasesWe support the IASB's intention to remove the potential confusion regarding the treatmentof lease incentives in Illustrative Example 13 accompanying IFRS 16.However, we think the removal from the example would not improve the understanding ofIFRS 16. We suggest the IASB instead clarifies the example by providing morebackground/information about the nature of the payment related to leaseholdimprovements and the reasons why it did not meet the definition of lease incentives inIFRS 16. With additional information and clarification, readers can better understand whythe accounting treatment for the payment from the lessor relating to leaseholdimprovements is different from the reimbursement of the real estate commission in thesame example.Work undertaken by HKICPA in forming its views:
The HKICPA:
(a) issued an Invitation to Comment on the Exposure Draft on 22 May 2019 to ourstakeholders;
(b) sought input from its Financial Instruments Advisory Panel and Leases AdvisoryPanel comprising technical and industry experts and auditors from accounting firms;
and(c) developed its views through its Financial Reporting Standards Committee, havingreflected on its stakeholder feedback. The Committee comprises of academics,preparer representatives from various industry sectors, investors, regulators, andtechnical and industry experts from small, medium and large accounting firms.If you have any questions regarding the matters raised in this letter, please contact me orNorman Chan, Associate Director in the Standard Setting Department(Normanchan@hkicpa.org.hk).Yours sincerely,Christina NgDirector, Standard SettingCN/NCEncl.
IASB Exposure Draft ED/2019/2 Annual Improvements to IFRS Standards 2018-2020
下载原件Our Ref.: C/FRSCSent electronically through the IASB Website (www.ifrs.org)
15 August 2019Mr Hans HoogervorstInternational Accounting Standards BoardColumbus Building7 Westferry CircusCanary WharfLondon E14 4HDUnited KingdomDear Hans,IASB Exposure Draft ED/2019/2 Annual Improvements to IFRS Standards 2018-2020The Hong Kong Institute of Certified Public Accountants is the only body authorised bylaw to set and promulgate standards relating to financial reporting, auditing, and ethics forprofessional accountants, in Hong Kong. We are grateful for the opportunity to provideyou with our comments on this Exposure Draft.We welcome the IASB's annual improvements to make necessary, but non-urgent,amendments to IFRS Standards that address inconsistencies in the application ofStandards and clarify the wording in a Standard.We have comments on the proposed amendments to the following Standards:
IFRS 9 Financial InstrumentsWe support the IASB's proposal to clarify the fees that an entity includes in assessingwhether the terms of a new or modified financial liability are substantially different fromthe terms of the original financial liability.Some Stakeholders in the banking industry also request to clarify in paragraph B3.3.6 ofIFRS 9 whether fees/amounts paid to cover fair value changes are to be included in thecalculation. They also suggest similar clarification be made in paragraph 5.4.3 of IFRS 9.Illustrative Examples accompanying IFRS 16 LeasesWe support the IASB's intention to remove the potential confusion regarding the treatmentof lease incentives in Illustrative Example 13 accompanying IFRS 16.However, we think the removal from the example would not improve the understanding ofIFRS 16. We suggest the IASB instead clarifies the example by providing morebackground/information about the nature of the payment related to leaseholdimprovements and the reasons why it did not meet the definition of lease incentives inIFRS 16. With additional information and clarification, readers can better understand whythe accounting treatment for the payment from the lessor relating to leaseholdimprovements is different from the reimbursement of the real estate commission in thesame example.Work undertaken by HKICPA in forming its views:
The HKICPA:
(a) issued an Invitation to Comment on the Exposure Draft on 22 May 2019 to ourstakeholders;
(b) sought input from its Financial Instruments Advisory Panel and Leases AdvisoryPanel comprising technical and industry experts and auditors from accounting firms;
and(c) developed its views through its Financial Reporting Standards Committee, havingreflected on its stakeholder feedback. The Committee comprises of academics,preparer representatives from various industry sectors, investors, regulators, andtechnical and industry experts from small, medium and large accounting firms.If you have any questions regarding the matters raised in this letter, please contact me orNorman Chan, Associate Director in the Standard Setting Department(Normanchan@hkicpa.org.hk).Yours sincerely,Christina NgDirector, Standard SettingCN/NCEncl.