27/04/2023 - EFRAG’s Recommendations and Feedback Statement on Better Information on Intangibles
EFRAG has issued its Recommendations and Feedback Statement summarising the main comments received by EFRAG on its Discussion Paper Better Information on Intangibles – Which is the best way to go?
In August 2021, EFRAG published the Discussion Paper Better Information on Intangibles – Which is the best way to go? (the ‘DP’). The DP assessed different approaches for standard setting to achieve better information on intangibles in financial reports without presenting an EFRAG position on the preferred approach(es). The Recommendations and Feedback Statement includes EFRAG’s tentative recommendations for developing IFRS requirements on intangibles used in the entity’s operations. These recommendations are based on the input EFRAG has received from comment letters, electronic surveys, outreach activities and supported academic studies. Based on this information the recommendations have been developed by the EFRAG FR TEG and the EFRAG FRB.
In the Recommendations and Feedback Statement, EFRAG observes that intangibles (including both intangible assets and other intangibles that do not meet the definition of an asset) may contain many different types of resources. EFRAG therefore recommends that all the approaches examined in the DP are considered – separately or in combination, depending on the type of intangibles – in order to provide better information on intangibles. The Recommendations and Feedback Statement explains which approach(es) would apply to the different types of intangibles. The Recommendations and Feedback Statement also includes other tentative recommendations to the IASB related to its forthcoming work on intangibles. These recommendations include, but are not limited to, clarifying the scope of IAS 38 Intangible assets and applying a phased approach to its standard setting activities on the topic.
