Technical resource centre

The FRC has issued FRED 80 Draft amendments to FRS 100 Application of Financial Reporting Requirements Application Guidance The Interpretation of Equivalence. This Financial Reporting Exposure Draft proposes to update the Application Guidance to FRS 100 to reflect changes to company law and decisions on equivalence further to the UK’s exit from the European Union. The objective of FRS 100 is to set out the applicable financial reporting framework for entities preparing financial statements in accordance with legislation, regulations or accounting standards applicable in the United Kingdom and Republic of Ireland.   Comments on FRED 80 are requested by 26 August 2022.

The FRC has released 29 updated ISAs (UK), amended to include conforming amendments arising from the revision of ISA (UK) 315 (Revised July 2020) Identifying and Assessing the Risks of Material Misstatement. The revised ISAs (UK) are: 200, 210, 220, 230, 240, 250A, 260, 265, 300, 320, 330, 402, 450, 500, 501, 505, 520, 530, 540, 550, 570, 580, 600, 610, 620, 700, 701, 720. ISQC (UK) 1 has also been updated. A link to the updated ISAs can be viewed here.

Welcome to this week’s Technical Roundup. In developments this week, the International Accounting Standards Board has issued the latest edition of its newsletter 'Investor Update', which profiles recently introduced IFRS Standards and other changes that are in the pipeline as well as how those changes may affect companies and performance and the European Securities and Markets Authority has released a public statement on the implications of Russia’s invasion of Ukraine on half-yearly financial reports. Read more on these and other developments that may be of interest to members below. Auditing The International Auditing and Assurance Standards Board has released non-authoritative guidance, The Fraud Lens – Interactions Between ISA 240 and Other ISAs. The guidance illustrates the relationship and linkages between International Standard on Auditing (ISA) 240, The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements and other ISAs when planning and performing an audit engagement and reporting thereon. The Irish Auditing and Accounting Supervisory Authority (IAASA) has published its 2021 Annual Audit Programme and Activity Report which summarises the activities performed during 2021 to oversee the audit profession in Ireland. Financial Reporting Chartered Accountants Ireland are looking forward to welcoming members of the Financial Reporting Council (FRC) to Chartered Accountants House on 16 June for a free in-person event.  This event will include addresses from members of the Accounting and Reporting Policy team as well as the FRC Lab and will provide attendees with an update on topical financial reporting issues in 2022 and the FRC Lab’s recent and current projects. Members who wish to attend can sign up here. The IASB has issued the latest edition of its newsletter 'Investor Update', which profiles recently introduced IFRS Standards and other changes that are in the pipeline as well as how those changes may affect companies and performance. ESMA has issued a Public Statement on the transparency of disclosures on the adoption of IFRS 17 Insurance Contracts. The European Financial Reporting Advisory Group (EFRAG) is holding a series of educational sessions jointly for the EFRAG Sustainability Reporting Board (SRB) and the EFRAG Sustainability Reporting TEG (SR TEG) on the draft ESRS Exposure Drafts (EDs) issued for public consultation on 29 April. Recordings of previous sessions and registration for upcoming sessions are available on EFRAG’s website. In its recent announcement, the International Sustainability Standards Board have outlined the necessary steps required to establish a comprehensive global baseline of sustainability disclosures. In IFAC’s recent podcast called The Fast Future with IFAC, some issues relevant to small & medium practices worldwide were discussed including technology, cybersecurity & workplace culture. The UK Endorsement Board (UKEB) has announced that it has approved the adoption of the International Accounting Standards Board’s (IASB) IFRS 17 Insurance Contracts for use by UK companies. The FRC has published a thematic review of discount rates. The European Securities and Market Authority (ESMA) has issued a statement on the implications of Russia’s invasion of Ukraine on half-yearly financial reports. Reminder- Have your say on the FRC’s periodic review of UK and Ireland accounting standards. As part of the FRC’s periodic review of UK and Ireland Accounting Standards, a series of roundtable events are being held in May and June to allow stakeholders to have a say on specific topics. The schedule of roundtables, as well as details of how to register, can be obtained from the FRC website. Insolvency The Dáil and Seanad recently approved Ireland’s opt into a regulation amending the Annexes to the European Insolvency Regulation, 2015/848 (EIR Recast). Regulation 2021/2260 (Amending Regulation) which replaces Annex A and B to EIR Recast came into force in January 2022. EIR Recast provides for the recognition and enforcement of cross border insolvency proceedings between EU member states.  Anti-Money Laundering and Sanctions The Institute has this week launched webpages providing information and resources to members in the area of anti-money laundering. The pages are located on the Institute’s technical hub (please click here to access) and cover both the Republic of Ireland and the UK on areas such as legislation, supervision, reporting requirements, red flags -know the signs and other resources which we hope members will find useful. This builds on the information provided by the CCAB-I working group in the recent update of  the CCAB-I Anti Money Laundering Guidance for members TR01/2019 (updated March 2022) and we hope that the information will prove to be valuable to members. The Egmont group has recently made public a report on Financial Intelligence Unit’s role in the fight against money laundering of corruption proceeds within the context of the Covid-19 pandemic. Various FIUs across the Egmont Group (EG) membership contributed. FIUs provided detailed information, including detected corruption-related risks and associated mitigating measures, relevant case examples and lessons learned, and emerging best practices and future challenges. You can access the report here . The UK National Crime Agency has recently published its Annual Plan 2022-23. Read here the strategic priorities for the Agency and you can download a copy of the plan here. The NCA publishes a bulletin called SARs in Action. You can access it by going to this page and searching in the description box by title. Click here to access the March 2022 edition. Other Areas of Interest The Minister for Finance and the Minister of State for Financial Services, Credit Unions and Insurance recently hosted the Retail Banking Review Dialogue, an important event on the future of retail banking in Ireland. You can read details about it by following the link. Also, this week the Dept. of Finance has launched a public consultation seeking stakeholder views on the Retail Banking Review. The focus of the review and consultation is on retail banking services. You can register on the government’s portal to respond. The consultation runs until 8 July 2022. President von der Leyen recently gave details of the Commission's proposals regarding REPowerEU, the EU plan to replace Russian fossil fuels, its investment in defence to address capability gaps and the relief and reconstruction of Ukraine with a proposal  to top up the significant short-term relief provided until now to Ukraine with a new exceptional macro-financial assistance . The Pensions Authority has this week issued a reminder of the compliance deadline of 1 July 2022 for master trusts, one-member arrangements set up on or after 22 April 2021 and new schemes. It has also recently provided an information update in several areas. These are the pension benefit statement, the annual compliance statement, the 2022 EIOPA stress test, the interpretation of the regulated markets requirement and the use of electronic communications provided for under the Pensions Act 1990, as amended. You can read further information on their website. The National Standards Authority of Ireland reports that the UK has introduced a new domestic regulatory regime to ensure consumers are protected from unsafe and non-compliant goods. Manufacturers of goods previously subject to the EU’s CE marking will need to start using the UK Conformity Assessment Marking (UKCA) marking if they are placing goods on the market in Great Britain. There are also new requirements for placing goods on the market in Northern Ireland. Businesses need to start preparing now to ensure they are compliant by 1 January 2023.The UK’s Department for Business, Energy and Industrial Strategy (BEIS) and the National Standards Authority of Ireland (NSAI) have organised a webinar to explain the rules and requirements, and what steps businesses need to take to use the UKCA marking and the UKNI marking for Northern Ireland. The webinar will take place from 11.00 – 12.00 Monday 30th May and you can go to this page to register. The Dept of Public Expenditure and Reform has recently published “An Evaluation of the Impacts of Remote Working “. The publication evaluates the impacts of remote working to the Irish economy and society. It finds that overall, remote working is likely to have a positive impact on the Irish economy and society. You can download a copy of the publication from this page. For further technical information and updates please visit the Technical Hub on the Institute website.   

The Institute has today launched webpages providing information and resources to members in the area of anti-money laundering. The pages are located on the Institute’s technical hub (please click here to access) and cover both the Republic of Ireland and the UK on areas such as legislation, supervision, reporting requirements, red flags -know the signs and other resources which we hope members will find useful. This builds on the information provided by the CCAB-I working group in the recent update of  the CCAB-I Anti Money Laundering Guidance for members TR01/2019 (updated March 2022) and we hope that the information will prove to be valuable to members.

The Institute has today launched a webpage on the Small Companies Administrative Rescue Process known as SCARP.  The SCARP is designed to address the specific needs of small and micro companies in financial difficulties. It allows viable companies experiencing temporary financial problems to restructure with the agreement of creditors.  This webpage includes a series of resources to assist members including an overview of the process and timeline, main differences between SCARP and examinership, practical questions and answers and link to a recently hosted webinar and other resources that may be of assistance to members. In addition to the resources outlined above, Technical Alert 02/2022 Small Companies Administrative Rescue Process and an additional guidance document Small Companies Administrative Rescue Process - practical guidance for company directors in a Q&A style are also included on the webpage.

The CCAB-I Insolvency Committee has today published Technical Alert 02/2022 Small Companies Administrative Rescue Process and an additional guidance document Small Companies Administrative Rescue Process - practical guidance for company directors in a Q&A style. This Technical Alert highlights the features of the Companies (Rescue Process for Small and Micro Companies) Act 2021.  The legislation has created a rescue process for small and micro companies known as Small Company Administrative Rescue Process (SCARP). The purpose of SCARP is to provide an alternative to examinership, for the benefit of small and micro companies, which is more accessible and cost efficient than the existing examinership process and capable of conclusion within a shorter period of time and to assist viable small and micro companies to remain in business while trading through periods of temporary difficulty. This Technical Alert and guidance document are both available on our website.

The Irish Auditing and Accounting Supervisory Authority (IAASA) has today published its 2021 Annual Audit Programme and Activity Report This report provides a summary of the activities performed by IAASA during 2021 to oversee the audit profession in Ireland. The report outlines the outcome of IAASA’s quality assurance review of auditors of public–interest entities as well as IAASA’s oversight of the recognised accountancy bodies who supervise auditors of other Irish entities. Key outcomes of IAASA’s work on the public oversight of statutory auditors in 2021 include: ·        Inspection of seven PIE firms, reviewing 30 audits and five internal control areas. ·        Conclusion of two statutory investigation into poor quality audit work. ·        Completion of seven joint inspections between IAASA’s Audit Quality Unit and IAASA’s Financial Reporting Supervision Unit. ·        Issuance of thematic reports by IAASA’s Audit Quality Unit on transparency reports and data analytics in statutory audit. ·        Revocation of recognition of two recognised accountancy bodies. ·        Hosting of an Audit Committee briefing. This report provides useful insights into IAASA’s work in overseeing the audit profession and will be of value to stakeholders seeking an enhanced understanding of audit and its regulation. The Annual Audit Programme and Activity Report is available here.

Welcome to this week’s Technical Roundup.  In developments this week, the European Financial Reporting Advisory Group have issued a feedback statement summarising the main comments received by them on its discussion paper- Accounting for Crypto-Assets (Liabilities) and the Financial Reporting Council are inviting stakeholders to attend a webinar to learn more about the work of the newly formed International Sustainability Standards Board (ISSB) and its first two proposed standards. Read more on these and other developments that may be of interest to members below. Financial Reporting The FRC Lab have published their first insight into current market issues. This publication explores questions about supply chain risks and reporting. The European Financial Reporting Advisory Group (EFRAG) have issued a feedback statement summarising the main comments received by them on its discussion paper- Accounting for Crypto-Assets (Liabilities). EFRAG have issued feedback statements in relation to its recent comment letters on IASB Exposure Drafts ED/2021/9- Non Current Liabilities with Covenants and ED/2021/10 Supplier Finance Arrangements. EFRAG have also issued an updated Endorsement Status Report as well as their April 2022 update. The IFRS Foundation have issued their April 2022 monthly news summary and IASB April 2022 update. Sustainability EFRAG has launched a public consultation on the Draft ESRS Exposure Drafts (EDs) developed by the EFRAG PTF-ESRS. The consultation period will run until 8 August 2022. The International Sustainability Standards Board (ISSB) held two live webinars at the end of April for all stakeholders on its proposed standards on general sustainability-related disclosures and climate-related disclosures, the recordings of which are available online. The FRC are also inviting stakeholders to attend a webinar to learn more about the work of the newly formed International Sustainability Standards Board (ISSB) and its first two proposed standards. Anti-Money Laundering and Sanctions On 4 May the European Commission President announced a sixth package of sanctions against Russia. The package is still to be agreed and details known to date are the sanctioning of high-ranking military officers and other individuals who committed war crimes, the exclusion from SWIFT of Sberbank and two other major banks, a ban on three Russian state-owned broadcasters from EU airwaves and a ban on Russian oil. This will be a complete import ban on all Russian oil, seaborne and pipeline, crude and refined. Further detailed information will when available be updated for members on the  Institute’s dedicated sanctions page. IFAC, together with the ICAEW, have released their latest instalment in its Anti-Money Laundering: The Basics educational series: Instalment Nine: Tools to Fight Back.  The publication is part of a series helping accountants enhance their understanding of how money laundering works, the risks they face, and what they can do to mitigate these risks and make a positive contribution to the public interest. Instalment nine examines the tools professional accountants have at their disposal to address money laundering once it’s suspected. Other Areas of Interest The FCA are consulting on rules which will allow Authorised Fund Managers to create separate unit classes (side pockets) for retail investment funds affected by the invasion of Ukraine. It says that the Russian invasion of Ukraine has resulted in some investments becoming illiquid or untradeable. You can access the consultation document here and feedback on the  proposals should be given on the online response form by Monday, 16 May 2022. Last week we reported that the European Data Protection supervisor (EDPS) recently published his Annual Report 2021. This week the EPDS issued its monthly newsletter which includes information on the EPDS conference in June, a joint opinion on the extension of the EU Digital COVID Certificate Regulation and issuance of a reprimand to the European Border and Coast Guard Agency (Frontex) for moving to the cloud without proper data protection assessment. You can access the newsletter here. The Summer 2022 Legislation Programme has been published recently by Government Chief Whip Jack Chambers. Among the priority legislation is a Work -life balance bill the heads of which are in preparation. The Assisted Decision Making Capacity (Amendment) Bill, Right to Request Remote Work Bill and Central Bank (Individual Accountability Framework) Bill all of which heads have been approved, are also on the priority list. Others which may be of interest are the Cyber Security Bill and the Cybercrime Bill and ones which have been in previous programmes are referenced: the Co-operative Societies Bill, Limited Partnership Bill and Charities (Amendment) Bill. The Government has recently published the general scheme of the Charities (Amendment) Bill 2022. The Bill proposes to update existing charity law to improve the ability of the Charities Regulator to conduct its statutory functions and ensure greater public trust and confidence in the sector. It will also deal with other matters such as clarification on the general duties of trustees and strengthening the Regulator’s powers in relation to the protection of charitable organisations. You can read the press release from the Minister at the Dept of Rural and Community Development and download the general scheme of the Bill here. Charities Act (Northern Ireland) 2022: Chief Executive of the Charity Commission for Northern Ireland, Frances McCandless, gives a brief overview of the impact of the new Charities Act (Northern Ireland) 2022 in the first of a series of vlogs (opens in YouTube): https://youtu.be/IXvok54YJ3U  The Dept. of Enterprise Trade and Employment (DETE) has invited expressions of Interest for appointment as Ministerial Nominees to the Company Law Review Group. The CLRG is a statutory advisory expert body charged with advising the Minister for Enterprise, Trade and Employment on the review and development of company law in Ireland.  CLRG members have expertise and an interest in the development of company law, including practitioners (the legal profession and accountants). You can read details of the expressions of Interest here and the closing time and date is 3pm on Thursday, 19 May 2022. DETE has also published its monthly newsletter which is available here and includes details of the recently published Consumer Rights Bill 2022. The Government is in the process for the nomination of a person to be appointed as President of the High Court. The current President, the Hon Ms Justice Mary Irvine, is due to retire in July 2022. A non-statutory Advisory Committee will be established to assist with identifying eligible and qualified persons, including serving judges, for the post of President of the High Court. It will consider their suitability and make recommendations to the Minister for Justice on preferred candidates. The EU Commission has made a proposal for a new EU initiative, the Single Market Emergency Instrument (SMEI) to enable the EU to respond quickly to emergencies and crises (such as a public health crisis or a natural disaster) that threatens the functioning of the single market. It is holding a public consultation with a deadline of 11 May 2022 for responses. You can read more about the SMEI here. For further technical information and updates please visit the Technical Hub on the Institute website. 

In developments this week, Accountancy Europe has written a letter to the European Commission's Commissioner Mairead McGuinness on the development of purposeful and effective European sustainability reporting standards and IAASA has published its annual Profile of the Profession for 2021 which presents an overview of the Prescribed Accountancy Bodies’ members and students and includes statistics about regulatory and monitoring activities. Read more on these and other developments that may be of interest to members below. Financial Reporting EFRAG has published a Draft Letter on the IFRS Interpretation Committee's Tentative Agenda Decisions in the final phase of implementing IFRS 17 Insurance Contracts and seeks constituents' views on the letter. The IFRS Interpretations Committee have issued its April 2022 update which includes the details of its recent meeting on 20th April. The Financial Reporting Council (FRC) has published new research, in conjunction with the UK Anti-Slavery Commissioner and Lancaster University, which has identified significant shortcomings in the quality of companies’ modern slavery reporting. Auditing IFAC has published “Audit Fees Survey 2022: Understanding Audit and Non-Audit Service Fees, 2013-2020”. As part of its ongoing consultation in relation to the proposed amendments to ISA (UK) 600, the FRC has invited stakeholders to its upcoming webinar on 4th May and virtual roundtables on 11th and 12th May The FRC has made changes to its Publication Policies for the Audit Enforcement Procedure (AEP) and the Accountancy and Actuarial Schemes (the Schemes). Sustainability Accountancy Europe has written a letter to the European Commission's Commissioner Mairead McGuinness on the development of purposeful and effective European sustainability reporting standards. Anti-Money Laundering and Sanctions FATF has recently published its first report on the state of effectiveness and compliance with the FATF standards. It gives a comprehensive overview of the state of global efforts to tackle money laundering, terrorist and proliferation financing. It states that the non-financial sector, including accountants generally have a poor understanding of risks from money laundering and terrorist financing and struggle to mitigate them. There are also some harsh conclusions on systems to monitor and enforce transparency in beneficial ownership. Fscom, a UK compliance firm, has recently published a handbook entitled “AML in Crypto Handbook“ which is a short introduction to Anti-Money Laundering in the context of cryptoassets. Their aim is to provide a beginner’s insight to cryptoassets from the point of view of an AML professional. The handbook is free to download from their website. The UK Financial Conduct Authority (FCA) recently conducted a review of financial crime controls in “challenger“  banks. Broadly speaking such banks are a sub-sector of retail banks which aim to reduce the market concentration of traditional high street banks through the use of technology and more up-to-date IT systems and some of them are online-only banks. The review found there is a need to improve how such banks  assess financial crime risk. Some are failing to adequately check their customers’ income and occupation, and, in some instances, challenger banks did not have financial crime risk assessments in place for their customers. You can read the press release here and the finding of the multi firm review here. The House of Commons library has recently published a research briefing entitled “Sanctions against Russia”. In it the briefing deals with the UK Sanctions regime prior to 2022, what prompted fresh sanctions, what sanctions the UK is imposing, co -ordinating with allies and the imposition of secondary sanctions. Readers should go to the website of the Workplace Relations Commission to read about information for Ukrainian Nationals on employment rights in Ireland. There is information on the website on employment law rights in Ireland in the Ukrainian language and the Russian language. The European Banking Authority (EBA) recently published a statement addressed to both financial institutions and supervisors to ensure they make every effort to provide access for Ukrainian refugees to at least basic financial products and services. They also set out how AML/CFT guidelines should apply .You can read details of the statement here. Members are reminded that you can locate further detailed information on sanctions generally on the Institute’s dedicated sanctions page which is being regularly updated at the moment. Other Areas of Interest Minister Robert Troy announced on 28 April 2022 that the “interim period” introduced under the Companies (Miscellaneous Provisions) (Covid-19) Act 2020 (“2020 Act”) has been further extended to 31 December 2022. It had been due to expire on 30 April 2022. The 2020 Act among other provisions made it possible for company meetings, for example AGMs and EGMs, class meetings and scheme meetings to be held virtually. It also increased the period of company examinership to 150 days and increased the threshold at which a company is deemed unable to pay its debts to €50,000. The Minister said this is likely to be the final extension but also noted that work is ongoing to put virtual AGMs and general meetings on a permanent statutory footing. The European Data Protection supervisor (EDPS) recently published his Annual Report 2021 - you can read the press release here and the executive summary here. The report covers a huge amount including an overview of the EDPS’ supervisory activities such as the supervision of Europol and the European Public Prosecutor’s Office. In one of its news items on the annual report the EDPS refers to its’ work on international transfers of personal data; on COVID-19; on the Area of Freedom, Security and Justice; as well as the EDPS' legislative consultations and technology monitoring activities. Late last year the Central Bank gave notice of its intention to establish a Climate Risk and Sustainable Finance Forum. In recent days it has published a call for interest to the forum. You can read the press release here. The forum will be consultative and will meet twice a year, with the inaugural meeting taking place on 29 June 2022. It is looking for expressions of interest from the likes of financial sector representative bodies, financial sector participants (firms), experts on climate change. Selection criteria are set out in the call for interest and you can complete the expression of interest form here. The Central Bank Director General of Financial conduct recently addressed an Institute of Banking/Compliance Institute seminar on “The importance of effective governance, culture, and agility in a changing environment". She spoke about topics including the Central Bank’s strategic approach, standards and the enhanced Individual Accountability Framework, Structural changes in the Irish retail banking sector and Sustainable finance and the risks of greenwashing. You can read her remarks here. The Dept of Finance (DOF) this week launched Ireland’s first Women in Finance Charter. The Charter is open to all financial services firms operating in Ireland and signatories commit their organisations to improving the number of women in management and board level positions to achieve better gender balance and a more inclusive working environment. You can read the press release here and see the current list of signatories to the Charter. DOF has also recently published its Economic Insights – Spring 2022 which provides analysis and insights on topical economic issues and developments. You can download here. IAASA has published its annual Profile of the Profession for 2021 which presents an overview of the Prescribed Accountancy Bodies’ (PABs) members and students and includes statistics about regulatory and monitoring activities. The Charity Commission for Northern Ireland has issued some useful information on the Charities Act (Northern Ireland) 2022. Readers may be interested in the recent publication of the Consumer Rights Bill 2022. This new draft legislation will bring about a number of positive changes for consumers and for the first time, consumer protections will be extended to digital goods and services so that consumers are protected when they use cloud services or buy downloadable or streamed goods and services, including games, films, music and software. The Competition and Consumer Protection Commission has welcomed the publication of the bill and you can read more about it on their website here where you will also find a link to the draft legislation. National Standards Authority of Ireland is Ireland’s official standards body under the auspices of DETE. It recently launched its new strategy for 2022-2026 – Innovating to Shape a Safer, Better, and Sustainable Future. The strategy is stated to give priority to Climate Action and Sustainability; to Digital Transformation; to Construction, with a particular focus on housing; and to Medical Technology. You can download the strategic plan here . In other FCA news, the CEO recently delivered a speech on the critical issues in financial regulation: The FCA's perspective. He mentioned issues such as the war in Ukraine, economic, social and governance (ESG) reforms, diversity and inclusion, accountability and performance and innovation and crypto. You can read the speech here. For further technical information and updates please visit the Technical Hub on the Institute website.