IASB seeks comments on proposed narrow-scope amendments to IAS 8

Yesterday, the IASB published for public consultation proposed narrow-scope amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors.

IAS 8 sets out the criteria for selecting and changing accounting policies. When a company changes an accounting policy, it is currently required to apply the new policy as if it had always applied this policy―unless this is not practicable.

Companies may decide to change an accounting policy as a result of an agenda decision published by the IFRS Interpretations Committee. The IASB is proposing that in deciding how far back to go in applying a change in accounting policy that results from an agenda decision, a company will consider not only whether it is practicable but also the benefits to users and costs to the company of making the change.

The aim of the proposed amendments to IAS 8 is to promote greater consistency in the application of IFRS Standards, reduce the burden on companies when they change an accounting policy as a result of an agenda decision and, thus, improve the overall quality of financial reporting.

The Exposure Draft ED/2018/1 Accounting policy changes (Proposed amendments to IAS 8) can be found here. The comment deadline is 27 July 2018.