Our Ref.: C/FRSCSent electronically through the IASB Website (www.ifrs.org)
9 October 2015Mr Hans HoogervorstInternational Accounting Standards Board30 Cannon StreetLondon EC4M 6XHUnited KingdomDear Hans,IASB Exposure Draft ED/2015/7Effective Date of Amendments to IFRS 10 and IAS 28The Hong Kong Institute of Certified Public Accountants is the only body authorised bylaw to set and promulgate standards relating to financial reporting, auditing, and ethicsfor professional accountants, in Hong Kong. We are grateful for the opportunity toprovide you with our comments on this Exposure Draft (ED).As we stated in our submission on the original proposals (i.e. ED/2012/6), we did notconsider that this piecemeal amendment was an improvement to IFRSs. Instead, asstated in our submission, we consider the conflict between IFRS 10 ConsolidatedFinancial Statements and the equity method should be dealt with as part of the IASB'sfundamental review of the equity method of accounting so that conceptual concerns(i.e. the principles underlying the application of the equity method) can be addressedcomprehensively rather than on a piecemeal basis. A copy of our previous submissionon that subject is attached as Annex 1 to this submission.We are therefore supportive of the proposal to indefinitely defer the effective date ofthe amendments Sale or Contribution of Assets between an Investor or its Associate orJoint Venture (amendments to IFRS 10 Consolidated Financial Statements and IAS 28Investments in Associates and Joint Ventures) while work continues on this morecomprehensive review.Having said that, we are concerned that indefinitely deferring the effective date of theamendments after following a thorough due process would impair the credibility of theIASB's standard-setting process. We therefore request that the IASB reviews its dueprocess to see whether anything could be done to minimise the risk that similarsituations occur in future.If you have any questions regarding the matters raised in this letter, please contact me orBen Lo, Associate Director of the Standard Setting Department at (ben@hkicpa.org.hk).Yours sincerely,Christina NgHead of Financial ReportingCN/BLOur Ref.: C/FRSCSent electronically through the IASB Website (www.ifrs.org)
10 May 2013International Accounting Standards Board30 Cannon StreetLondon EC4M 6XHUnited KingdomDear Sirs,IASB Exposure Draft of Sale or Contribution of Assets between an Investor andits Associate or Joint Venture (Proposed Amendments to IFRS 10 and IAS 28)
The Hong Kong Institute of Certified Public Accountants is the only body authorised bylaw to promulgate financial reporting, auditing and ethical standards for professionalaccountants in Hong Kong. We welcome the opportunity to provide you with ourcomments on this Exposure Draft (ED). Our responses to the questions raised in yourInvitation to Comment are set out in the Appendix for your consideration.We agree with the IASB that there is inconsistency between IAS 28 and IFRS 10 inregards to the treatment of gains and losses upon the sale or contribution of asubsidiary. However, we are concerned that the proposed amendments would introducean exception to the general requirements for measuring the gain or loss on the loss ofcontrol of a subsidiary of IFRS 10. This will introduce an inconsistency in IFRS 10 asaccounting for the loss of control of a subsidiary when it is sold or contributed to anassociate or joint venture, would in future depend on whether that subsidiary is abusiness or not. On the contrary, we note that no such distinction would exist if, insteadof selling the subsidiary to an associate, the parent sells enough shares in that investeeto another party such that the subsidiary itself becomes an associate. In such a case,the nature of the subsidiary itself as to whether it is a business or not is irrelevant to theaccounting treatment required by IFRS 10 as a result of the loss of control.We therefore do not consider that this piecemeal amendment is an improvement toIFRSs. Instead we believe that the conflict between IFRS 10 and the equity methodshould be dealt with as part of the fundamental review of the equity method ofaccounting as part of the IASB's work programme so that conceptual concerns (i.e. theprinciples underlying the application of the equity method) as expressed in paragraphBC7 of the Basis for Conclusions of the ED can be addressed.If you have any questions regarding the matters raised in our submission, pleasecontact Winnie Chan, our Manager of Standard Setting at winniechan@hkicpa.org.hk.Yours faithfully,Simon RileyDirector, Standard SettingSR/WCEncl.Annex 1Comment on IASB Exposure Draft of Sale or Contribution of Assets between anInvestor and its Associate or Joint Venture (Proposed Amendments to IFRS 10and IAS 28)
Question 1: Proposed amendment to IFRS 10The IASB proposes to amend IFRS 10 so that the gain or loss resulting from thesale or contribution of a subsidiary that does not constitute a business, asdefined in IFRS 3, between an investor and its associate or joint venture isrecognised only to the extent of the unrelated investors' interests in the associateor joint venture. The consequence is that a full gain or loss is recognised on theloss of control of a subsidiary that constitutes a business, as defined in IFRS 3,including cases in which the investor retains joint control of, or significantinfluence over, the investee.Do you agree with the amendment proposed? Why or why not? If not, whatalternative do you propose?We are concerned that the proposed amendments would introduce an exception to thegeneral requirements for measuring the gain or loss on the loss of control of asubsidiary of IFRS 10. This will introduce an inconsistency in IFRS 10 as accounting forthe loss of control of a subsidiary when it is sold or contributed to an associate or jointventure will depend on whether that subsidiary is a business or not. On the contrary, wenote that no such distinction would exist if, instead of selling the subsidiary to anassociate, the parent sells enough shares in that investee to another party such that thesubsidiary itself becomes an associate. In such a case, the nature of the subsidiaryitself, as to whether it is a business or not, is irrelevant to the accounting treatmentrequired by IFRS 10 as a result of the loss of control.We therefore do not consider that this piecemeal amendment is an improvement toIFRSs. Instead we believe that the conflict between IFRS 10 and the equity methodshould be dealt with as part of the fundamental review of the equity method ofaccounting as part of the IASB's work programme so that conceptual concerns (i.e. theprinciples underlying the application of the equity method) as expressed in paragraphBC7 of the Basis for Conclusions in the ED can be addressed.If the IASB decides to continue with this amendment, then we suggest that paragraphB99A of the ED be clarified so that it addresses only the gain or loss related to theinvestment in subsidiary (that is not a business) that is sold or contributed to theassociate or joint venture. As currently worded, the ED could be interpreted to requirethat any gain or loss on re-measurement at fair value of a retained interest in thesubsidiary should not be recognised.APPENDIXQuestion 2: proposed amendment to IAS 28 (2011)
The IASB proposes to amend IAS 28 (2011) so that:
(a) the current requirements for the partial gain or loss recognition fortransactions between an investor and its associate or joint venture onlyapply to the gain or loss resulting from the sale or contribution of assets thatdo not constitute a business, as defined in IFRS 3; and(b) the gain or loss resulting from the sale or contribution of assets thatconstitute a business, as defined in IFRS 3, between an investor and itsassociate or joint venture is recognised in full.Do you agree with the amendment proposed? Why or why not? If not, whatalternative do you propose?We do not agree with the proposed amendment for the same reasons as stated in ourresponse to Question 1.Question 3: transition requirementsThe IASB proposes to apply the proposed amendments to IFRS 10 and IAS 28
(2011)prospectively to sales or contributions occurring in annual periodsbeginning on or after the date that the proposed amendments would becomeeffective.Do you agree with the proposed transition requirements? Why or why not? If not,what alternative do you propose?If the IASB decides to continue with this amendment, then we agree that prospectiveapplication would be appropriate.~ End ~
IASB Exposure Draft ED/2015/7 Effective Date of Amendments to IFRS 10 and IAS 28
下载原件Our Ref.: C/FRSCSent electronically through the IASB Website (www.ifrs.org)
9 October 2015Mr Hans HoogervorstInternational Accounting Standards Board30 Cannon StreetLondon EC4M 6XHUnited KingdomDear Hans,IASB Exposure Draft ED/2015/7Effective Date of Amendments to IFRS 10 and IAS 28The Hong Kong Institute of Certified Public Accountants is the only body authorised bylaw to set and promulgate standards relating to financial reporting, auditing, and ethicsfor professional accountants, in Hong Kong. We are grateful for the opportunity toprovide you with our comments on this Exposure Draft (ED).As we stated in our submission on the original proposals (i.e. ED/2012/6), we did notconsider that this piecemeal amendment was an improvement to IFRSs. Instead, asstated in our submission, we consider the conflict between IFRS 10 ConsolidatedFinancial Statements and the equity method should be dealt with as part of the IASB'sfundamental review of the equity method of accounting so that conceptual concerns(i.e. the principles underlying the application of the equity method) can be addressedcomprehensively rather than on a piecemeal basis. A copy of our previous submissionon that subject is attached as Annex 1 to this submission.We are therefore supportive of the proposal to indefinitely defer the effective date ofthe amendments Sale or Contribution of Assets between an Investor or its Associate orJoint Venture (amendments to IFRS 10 Consolidated Financial Statements and IAS 28Investments in Associates and Joint Ventures) while work continues on this morecomprehensive review.Having said that, we are concerned that indefinitely deferring the effective date of theamendments after following a thorough due process would impair the credibility of theIASB's standard-setting process. We therefore request that the IASB reviews its dueprocess to see whether anything could be done to minimise the risk that similarsituations occur in future.If you have any questions regarding the matters raised in this letter, please contact me orBen Lo, Associate Director of the Standard Setting Department at (ben@hkicpa.org.hk).Yours sincerely,Christina NgHead of Financial ReportingCN/BLOur Ref.: C/FRSCSent electronically through the IASB Website (www.ifrs.org)
10 May 2013International Accounting Standards Board30 Cannon StreetLondon EC4M 6XHUnited KingdomDear Sirs,IASB Exposure Draft of Sale or Contribution of Assets between an Investor andits Associate or Joint Venture (Proposed Amendments to IFRS 10 and IAS 28)
The Hong Kong Institute of Certified Public Accountants is the only body authorised bylaw to promulgate financial reporting, auditing and ethical standards for professionalaccountants in Hong Kong. We welcome the opportunity to provide you with ourcomments on this Exposure Draft (ED). Our responses to the questions raised in yourInvitation to Comment are set out in the Appendix for your consideration.We agree with the IASB that there is inconsistency between IAS 28 and IFRS 10 inregards to the treatment of gains and losses upon the sale or contribution of asubsidiary. However, we are concerned that the proposed amendments would introducean exception to the general requirements for measuring the gain or loss on the loss ofcontrol of a subsidiary of IFRS 10. This will introduce an inconsistency in IFRS 10 asaccounting for the loss of control of a subsidiary when it is sold or contributed to anassociate or joint venture, would in future depend on whether that subsidiary is abusiness or not. On the contrary, we note that no such distinction would exist if, insteadof selling the subsidiary to an associate, the parent sells enough shares in that investeeto another party such that the subsidiary itself becomes an associate. In such a case,the nature of the subsidiary itself as to whether it is a business or not is irrelevant to theaccounting treatment required by IFRS 10 as a result of the loss of control.We therefore do not consider that this piecemeal amendment is an improvement toIFRSs. Instead we believe that the conflict between IFRS 10 and the equity methodshould be dealt with as part of the fundamental review of the equity method ofaccounting as part of the IASB's work programme so that conceptual concerns (i.e. theprinciples underlying the application of the equity method) as expressed in paragraphBC7 of the Basis for Conclusions of the ED can be addressed.If you have any questions regarding the matters raised in our submission, pleasecontact Winnie Chan, our Manager of Standard Setting at winniechan@hkicpa.org.hk.Yours faithfully,Simon RileyDirector, Standard SettingSR/WCEncl.Annex 1Comment on IASB Exposure Draft of Sale or Contribution of Assets between anInvestor and its Associate or Joint Venture (Proposed Amendments to IFRS 10and IAS 28)
Question 1: Proposed amendment to IFRS 10The IASB proposes to amend IFRS 10 so that the gain or loss resulting from thesale or contribution of a subsidiary that does not constitute a business, asdefined in IFRS 3, between an investor and its associate or joint venture isrecognised only to the extent of the unrelated investors' interests in the associateor joint venture. The consequence is that a full gain or loss is recognised on theloss of control of a subsidiary that constitutes a business, as defined in IFRS 3,including cases in which the investor retains joint control of, or significantinfluence over, the investee.Do you agree with the amendment proposed? Why or why not? If not, whatalternative do you propose?We are concerned that the proposed amendments would introduce an exception to thegeneral requirements for measuring the gain or loss on the loss of control of asubsidiary of IFRS 10. This will introduce an inconsistency in IFRS 10 as accounting forthe loss of control of a subsidiary when it is sold or contributed to an associate or jointventure will depend on whether that subsidiary is a business or not. On the contrary, wenote that no such distinction would exist if, instead of selling the subsidiary to anassociate, the parent sells enough shares in that investee to another party such that thesubsidiary itself becomes an associate. In such a case, the nature of the subsidiaryitself, as to whether it is a business or not, is irrelevant to the accounting treatmentrequired by IFRS 10 as a result of the loss of control.We therefore do not consider that this piecemeal amendment is an improvement toIFRSs. Instead we believe that the conflict between IFRS 10 and the equity methodshould be dealt with as part of the fundamental review of the equity method ofaccounting as part of the IASB's work programme so that conceptual concerns (i.e. theprinciples underlying the application of the equity method) as expressed in paragraphBC7 of the Basis for Conclusions in the ED can be addressed.If the IASB decides to continue with this amendment, then we suggest that paragraphB99A of the ED be clarified so that it addresses only the gain or loss related to theinvestment in subsidiary (that is not a business) that is sold or contributed to theassociate or joint venture. As currently worded, the ED could be interpreted to requirethat any gain or loss on re-measurement at fair value of a retained interest in thesubsidiary should not be recognised.APPENDIXQuestion 2: proposed amendment to IAS 28 (2011)
The IASB proposes to amend IAS 28 (2011) so that:
(a) the current requirements for the partial gain or loss recognition fortransactions between an investor and its associate or joint venture onlyapply to the gain or loss resulting from the sale or contribution of assets thatdo not constitute a business, as defined in IFRS 3; and(b) the gain or loss resulting from the sale or contribution of assets thatconstitute a business, as defined in IFRS 3, between an investor and itsassociate or joint venture is recognised in full.Do you agree with the amendment proposed? Why or why not? If not, whatalternative do you propose?We do not agree with the proposed amendment for the same reasons as stated in ourresponse to Question 1.Question 3: transition requirementsThe IASB proposes to apply the proposed amendments to IFRS 10 and IAS 28
(2011)prospectively to sales or contributions occurring in annual periodsbeginning on or after the date that the proposed amendments would becomeeffective.Do you agree with the proposed transition requirements? Why or why not? If not,what alternative do you propose?If the IASB decides to continue with this amendment, then we agree that prospectiveapplication would be appropriate.~ End ~