EFRAG releases feedback statement on Non-exchange transfers

Released 09 July 2019

Following responses from constituents, the group has issued a feedback statement as a formal record of the points raised.

In November 2018, the European Financial Reporting Advisory Group issues the Discussion Paper Non-Exchange Transfers: A role for Societal Benefit? which closed for comment in April 2019. The group received 13 responses to the consultation. As a result of this feedback, EFRAG has issued the Feedback Statement on the consultation.

The Feedback Statement noted ‘Some respondents agreed that non-exchange transactions (NETs) have different characteristics but a majority did not support developing an approach aiming to address comprehensively all non-exchange transfers. Some respondents suggested that the existing IFRS Standards provided sufficient guidance as to how to account for NETs and the focus of the DP should be on considering the effects of the revised Conceptual Framework on NETs, in particular whether and how it would address identified issues…

‘Most respondents did not support the 4-step approach to account for NETs. In their view, the criterion of recognition of NETs income and expenses on a ‘recurring basis’ was not conceptually developed and instead it was based on a rule-based principle.’

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