IASB publishes revised proposals for determining the cost of an investment in separate financial statements

13 December 2007

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The International Accounting Standards Board (IASB) published today for public comment an exposure draft of proposed amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards and IAS 27 Consolidated and Separate Financial Statements. The exposure draft—Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate—was developed in response to comments received on a related exposure draft published in January 2007. In the light of those comments and further consultation with interested parties, the IASB reconsidered its proposals and, in accordance with its due process, now invites comment on the revised proposals.

The proposals address concern that retrospectively determining cost in accordance with IAS 27 on first-time adoption of International Financial Reporting Standards (IFRSs) cannot, in some circumstances, be achieved without undue cost or effort. Consequently, this might create a barrier to entities’ adoption of IFRSs in separate financial statements. Additionally, the proposals respond to enquiries received about the measurement of cost in the separate financial statements of a new parent entity.

Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate is available for eIFRS subscribers from today and will be freely available on the Website from 24 December 2007. It is open for comment until 26 February 2008.

Printed copies of the exposure draft (ISBN 978-1-905590-55-1) will be available shortly, at £10 plus shipping, from the IASC Foundation Publications Department. Those wishing to subscribe to eIFRSs should visit the online shop at www.iasb.org or contact:

IASC Foundation Publications Department,
30 Cannon Street, London EC4M 6XH, United Kingdom.
Tel: +44 (0)20 7332 2730 Fax +44 (0)20 7332 2749

Press enquiries:

Mark Byatt, Director of Corporate Communications, IASB, telephone: +44 (0)20 7246 6472, email: mbyatt@iasb.org

Sonja Horn, Communications Adviser, IASB,telephone: +44 (0)20 7246 6463, email: shorn@iasb.org

Technical enquiries:

Elizabeth Hickey, Director of Technical Activities, IASB, telephone:+44 (0)20 7246 6458, email: ehickey@iasb.org

Amy Schmidt, Project Manager, IASB telephone:+44 (0)20 7246 6452, email: aschmidt@iasb.org