New BDO Comment Letter – ED/2017/1 Annual Improvements to IFRSs 2015-2017 Cycle

BDO has submitted its comment letter in response to the International Accounting Standard Boards exposure draft ED/2017/1 Annual Improvements to IFRSs 2015-2017 Cycle.

In our comment letter we:

• agree with the intention of the proposed amendments to IAS 12 concerning how the income tax consequences of dividends should be accounted for.  However, we have suggested some changes to the drafting of those amendments which we believe more clearly reflect the intentions of the proposed improvements.  We also note that, because the amendments may bring a change in practice for some entities, it may be appropriate to consider some transitional relief.
• do not agree with the proposed amendments to IAS 28 concerning the need to apply IFRS 9’s impairment model to long-term interests that form part of the net investment in equity-accounted investments.  In our view, the issue of long term interests needs to be addressed comprehensively with related standard setting activities.  It is not appropriate for this issue to be left for a period of years until the Board considers equity accounting more broadly.

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