Accountancy Europe’s comment on climate related and other uncertainties in the financial statements

Accountancy Europe welcomes the work done by the IASB to address the reporting of climate related effects in financial statements. However, we emphasise the following two points merit further consideration by the IASB. We have provided other targeted feedback on the examples for the Board’s consideration in our letter.

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We don’t believe that “illustrative examples accompanying the IFRS Accounting Standards” would on their own, meet the intended objectives. To mitigate, we suggest a two-step approach:

1. group the examples and publish them as a single document, in addition to publishing them as illustrative examples accompanying the IFRS Accounting Standards
2. second, consider additional educational materials or an IFRS Practice Statement on the matter in which the IASB explains the overall approach and how these examples fit in the IFRS Accounting Standards and existing vehicles.

We also suggest that the IASB creates a webpage to consolidate all the materials related to climate as they are currently dispersed across different locations which is difficult to find and maintain.

Scope and content of the illustrative examples

Accountancy Europe believes that these illustrative examples should be more comprehensive, and thus expanded to:

• add examples touching on more IFRS Accounting Standards
• include cases where recognition and measurement could be impacted
• consider wider sustainability matters – beyond only climate
• better illustrate how the linkage between financial and sustainability reporting works and stimulate connective thinking.

We encourage the IASB to consider these suggestions to move the project forward.

Read the full consultation in the “Download” section.