ASCG’s comment letter on the IASB ED/2017/6 (Amendments to IAS 1/8)

The ASCG has published its comment letter in response to the IASB’s ED/2017/6 Definition of Material (Proposed amendments to IAS 1 and IAS 8) on 3 January 2018. The comment letter was also sent to EFRAG.

The ASCG generally supports the IASB proposals to align the definition and the identified need of clarification for parts of the definition of ‘material’ in IAS 1 and IAS 8. Nonetheless, the ASCG considers that it is not needed to describe material information in context of the terms ‘obscuring’, ‘omitting’, and ‘misstating’. Therefore, the ASCG proposes an alternative definition of ‘material’ in its comment letter.

Additionally, the ASCG considers the need of further clarification regarding the interpretation of the terms ‘not material information’ vs. ‘immaterial information’. Furthermore, the ASCG highlights that the IASB proposals would cause duplication of IFRS guidance in IAS 1 and IAS 8. Such redundancy of guidance should be avoided by the use of cross-references.