Hey everyone,
It’s been on my mind for a while that Reporting Period was a bit ephemeral living only in our inboxes. So, to mark the third anniversary of your favourite IFRS newsletter (the first issue was in March 2023), I’ve set up a proper archive of all past issues. In case you’re feeling nostalgic and want to see what was happening in IFRS back in 2023, head over to ReportingPeriod.com! 😉 Jokes aside, I hope you’ll find the archive useful.
Coming back to 2026, here are the key updates from last month.
Technical Publications
Geopolitical risks and uncertainties…
With the Iran war raging and energy supply chains shattered, EY figured it might be a good idea to update its analysis of how such risks translate into financial statements. The topics covered include:
- disclosures on estimates and judgements,
- impairment considerations,
- fair value measurements,
- onerous contracts,
- … and more.
… incl. US tariffs
A separate EY publication addresses how the US Supreme Court ruling that struck down most of the tariffs imposed by President Trump could impact financial statements, particularly with respect to derecognition of tariff obligations, recognition of refund receivables, and forward-looking projections (think impairment tests and various recoverability assessments).
Climate-related (and other) risks in financial statements
Building on the six illustrative examples on reporting uncertainties in financial statements that the IASB added to IFRS last year, BDO released a technical publication on key considerations when reflecting climate-related and other risks in the financial statements. This publication is divided into two sections: the first presents common climate-related scenarios and highlights key factors to assess when determining whether additional disclosures are necessary, while the second is essentially a climate-related disclosure checklist.
IOSCO’s updated statement on non-GAAP measures
The International Organization of Securities Commissions (IOSCO) has updated its statement on non-GAAP measures to address how it interacts with the requirements on management-defined performance measures (MPMs) in IFRS 18. My bet is that local regulators, like ESMA, will issue corresponding updates to their guidelines too.
IFRS Interpretations Committee meeting
At its March meeting, the Committee finalised one new tentative agenda decision. The question was whether an entity reassesses whether it retains control of an investee when the investee’s governing document is amended. The fact pattern was very specific, but its essence was that an entity was involved in setting the purpose and design of an investee when the investee was established. At that time, the entity concluded that it controlled the investee in accordance with IFRS 10.
However, the governing document of the investee was later amended in a way that resulted in a change in the investee’s relevant activities and in the rights of the entity and other parties. The request asked whether, under IFRS 10.8, the amendments to the investee’s governing document require the entity to reassess whether it retains control of the investee.
The Committee didn’t perform a technical analysis because outreach by IFRS staff showed that such scenarios aren’t common and, when they do happen, the generally accepted practice is to reassess control under IFRS 10.8.
Learn more in the staff paper prepared for the meeting, which reproduces the submitted scenario in full.
Next steps: Comments are open until 29 May 2026.
Work in Progress at the IASB
Upcoming IFRS 20
In May 2026, we will celebrate the arrival of a brand new IFRS. It’s a shame that such a nice round number was allocated to a relatively niche topic, relevant mainly for companies in the utilities and energy sectors. But hey, we don’t have that many occasions for celebration these days, so let’s be prepared to give a warm welcome to IFRS 20 Regulatory Assets and Regulatory Liabilities. And what should these preparations look like exactly, you ask? A good starting point is watching the IASB webcast with an overview of the new standard 😉
Post-implementation review of IFRS 16
Back in January 2026, the IASB discussed the summary of feedback on the ongoing post-implementation review of IFRS 16. One of the conclusions was that the continuing costs for lessees of applying IFRS 16 are higher than the IASB had originally expected. So, the Board will now explore the possibility of reducing these costs in two areas:
1. Remeasurements of the lease liability – by, for example:
- reducing the frequency of remeasurements of the lease liability; and
- simplifying the requirements for reassessing the lease liability to reflect changes in variable lease payments that are linked to an index or a rate.
2. Discount rates – by, for example, requiring or permitting lessees to use:
- a simplified discount rate instead of the incremental borrowing rate; and
- an unchanged discount rate for some remeasurements of the lease liability.
It seems that these will be the only follow-up projects resulting from the post-implementation review. I’m personally disappointed that the IASB doesn’t plan to improve the requirements and guidance on determining the lease term by incorporating the guidance from the 2019 agenda decision into the main body of IFRS 16.
Miscellany
FRC’s guidance on using AI in audit engagements
The UK FRC published guidance for audit firms on using generative and agentic AI tools in audit engagements. I’d say it’s kind of a big deal because it’s the first such guidance from any audit regulator. The FRC aims to help audit firms mitigate the risks of using AI, but also to build confidence in and support the use of AI in audit work. The guidance also outlines real-world audit scenarios, like using AI to summarise board minutes and review contracts.
(Gen)AI and professional judgement
Speaking of AI, the Institute of Chartered Accountants of Scotland (ICAS) has released the results of a year-long research study into generative AI and professional judgement in accounting. Let’s take a moment to appreciate the addition of “generative” here, because everyone now seems to equate GenAI with AI in general.
Anyway, ICAS conducted the research in collaboration with Beever and Struthers, a mid-tier accounting firm that provides accounting, audit, and tax services. Of the 200+ Beever and Struthers staff surveyed:
- 74% said the pace at which they performed tasks increased with GenAI,
- 72% were concerned about errors and client data privacy,
- 53% used GenAI to write emails and edit text, and
- 21% were concerned about job security.
IFRS Foundation’s 2025 annual report
The IFRS Foundation has recently been subject to some harsh criticism from the SEC and other US regulators for taking sustainability reporting onto its agenda, and thus arguably spreading its focus (and funding) too thin. The title of its 2025 annual report – Fit for the future – looks like an attempt to flip that narrative in its favour. Anyway, despite slightly lower revenue, it managed to turn a profit in 2025 thanks to cost savings.
That’s all for this edition of Reporting Period. Thanks for reading and see you in the next issue!
Best regards,
Marek