IASB proposes amendments to the retrospective application of IFRSs for first time adopters

The International Accounting Standards Board has published for public comment an exposure draft of proposed amendments to IFRS 1, First-time Adoption of International Financial Reporting Standards. The proposals address the retrospective application of IFRSs in selected areas and are aimed at ensuring that entities applying IFRSs will not face undue cost or effort in the transition process.

The exposure draft proposes:

to exempt companies from retrospective application of IFRSs for oil and gas assets using the full cost method and for operations subject to rate regulation;
to exempt companies with existing leasing contracts accounted for in accordance with IFRIC 4 Determining whether an Arrangement contains a Lease from reassessing the classification of those contracts according to IFRSs when the same classification has previously been made in accordance with national GAAP.

The exposure draft, Additional Exemptions for First-time Adopters, is freely available on www.iasb.org. It is open for comment until 23 January 2009.