IFRS change Pandemic

ROBERT BRUCE

The time is right for meaninful change

We live in difficult, chaotic times. We were already facing accelerating climate change. Then came the pandemic, bringing death and economic collapse, and then the death of George Floyd that crystallised our underlying inequalities.

Out of this chaos comes the chance for real change. As Peter Bakker, the President of the World Business Council for Sustainable Development, put it: “We simply don't have any excuse left not to build back better and implement deep systemic change, if we ever want all people to live well within planetary boundaries.” That’s the sort of thing that people in such organisations are always saying. But such has been the upheaval you would not bet against change coming about with urgency and speed.

The influential Ceres Accelerator for Sustainable Capital Markets also came up with a blockbuster report in June. ‘Addressing Climate as a Systemic Risk’ is a call to action for US financial regulators. “The magnitude of a crisis is determined not just by the impact of precipitating events, but by the fragility of the system it attacks,” says its introduction. “The world has been forced into a recalibration of values.”

Out of this change can come. Led by the US regulatory system, it could be locked into place. As the report says: “There will never be vaccines developed to protect against climate risk. But the good news is: we already have all the tools and knowledge in the financial markets to take sound preventative action.” There could be a silver lining to all this chaos. Robert Bruce is an award-winning writer on accountancy for The Times

In brief

Accountex rescheduled

Due to the ongoing pandemic Accountex, Europe’s biggest accountancy and finance conference and expo, has now been postponed until 2021, The show will return to ExCel London on 12-13 May 2021. Organisers Diversified Communications UK had shifted the Spring event to mid-November, but have now taken the decision to move it all to 2021. It said: “The decision has been widely supported by key exhibitors and association

Lease standard amended

The International Accounting Standards Board has issued an amendment to IFRS 16 Leases to make it easier for lessees to account for Covid-19-related rent concessions, such as rent holidays and temporary rent reductions.

The amendment exempts lessees from having to consider individual lease contracts to determine whether rent concessions occurring as a direct consequence of the pandemic are lease modifications. And it allows lessees to account for such rent concessions as if they were not lease modifications. It applies to Covid-19-related rent concessions that reduce lease payments due on or before 30 June 2021.

IFRS 16 specifies how lessees Hans Hoogervorst

should account for changes in lease payments, including concessions. However, applying those requirements to a potentially large volume of Covid-19-related rent concessions could be practically difficult, especially in the light of the many challenges stakeholders face during the pandemic. This optional exemption gives timely relief to lessees and enables them to continue providing information about their leases that is useful to investors. The amendment does not affect lessors.

ACCA PQs sitting exams this September need to be on top of new syllabus changes.

For PM sitters, big data and data analytics have been added. Performance data is another addition, along with a new section on the risks around IS and data analytics. That’s the only real changes at the Applied Skills level.

Changes to ACCA syllabus

There are more changes at the Strategic Professional level. The two key papers affected at APM and SBR, although there has been some minor tinkering on AAA.

Process automation and the Internet of Things have been added to the syllabus, as has AI and the use of presentation tools.

The amendment was effective 1 June 2020, and to ensure the relief is available when needed most lessees can apply the amendment immediately in any financial statements – interim or annual – not yet authorised for issue.

Hans Hoogervorst, chair of the International Accounting Standards Board, said: “The amendment is designed to make it easier for lessees, especially those with a lot of lease contracts, to account for Covid-19-related rent concessions while still providing useful information for investors.”

A former trainee accountant, Jake Currie, who was ‘left to his own devices’, managed to defraud his company out of £58,000. He used the money to buy a second-hand BMW, pay his Stockport mortgage – and a lot of booze!

Working for NUCO Travel, Currie made numerous payments into his own account over a six-month period. He then decided to go on ‘sick leave’, before announcing he was taking a holiday to Canada.

The firm decided it was time to part company, and its new trainee accountant quickly noticed the discrepancies in payments.

Former PQ spends stolen £58k on cars and booze

After pleading guilty to one count of fraud and two counts of transferring criminal property the 26-year old was sentenced to two years in prison suspended for two years. He must also undertake 200 hours of unpaid work.

Judge Bernadette Baxter said: “You made 22 transactions over a six-month period of £58,000. You did it in a state of mind where you felt sorry for yourself. You were spending the money on frivolous things, £9,000 on a mortgage and £10,000 payment towards a car. You have then drank and frittered away the rest of the money. I accept your behaviour was out of character for you.”

For SBR, the examiners want you to be able to discuss the impact of current reporting issues in corporate reporting. We are talking cryptocurrency and environmental issues here. • See page 28 for our full analysis of the changes come September.

partners”. Accountex Summit North will now take place on 21 September 2021.

Currie, pictured, is now working as a recruitment consultant.

Studying in a bubble

University graduates will have to study and live with the people on their courses as universities redesign campuses for new social distancing rules. Placing students in smaller course-mate ‘bubbles’ will limit mixing, minimise the risk of Covid-19 outbreaks on campus, and help universities reopen in the Autumn. There will also be limits on lecture sizes. Freshers Week will also be very different! Many are moving online, and there will be strict rules on the size of parties. Grindley hit the papers recently for all the right reasons. After he was furloughed two months ago he wanted to be a bit more active, so co-founded Furlonteer. The nonprofit website (furlonteer.com) connects charities and good causes with skilled willing people during the lockdown. TaskerGrindley told the Sunday Times: “I don’t want to look back on this time and think I wasted it.” So far more than 5,000 people have signed up to do a minimum of three hours a week.