Issued January 19, 2012 (No. 24)

Contents

1. Overview of ASBJ Meetings (232th Meeting – 233th Meeting)
2. ASBJ’s Comment Submitted to the IASB
3. The 14th Joint Meeting with the IASB Held in London
4. The 11th China-Japan-Korea Meeting
5. The 3rd AOSSG Meeting Held in Melbourne
6. The FASF Released the Launch of Accounting Human Resource
Development Program
7. Additional Appointment of Councillor of the FASF
8. The Establishment of Other Committees (Nominating and Evaluating
Committee, and Due Process Oversight Committee, and Operation
Supporting Committee)
9. FASF Hosted Constituents Gathering on the IFRS Foundation/IASB
10. FASF Seminar on Disclosure for New Practitioners

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1. Overview of ASBJ Meetings (232th Meeting – 233th Meeting)(1) 232nd Meeting (held on October 20, 2011)a. Progress of the Technical Committee for Financial Instruments
b. Progress of the Technical Committee for SPEs and Consolidation
At the beginning of the meeting, ASBJ Chairman Ikuo Nishikawa spoke about the “AccountingStandard for Fair Value Measurements and Disclosures” project. The project is currently under
way and requires additional time before finalizing the standard.

The exposure draft of the standard

was proposed to apply for the annual periods beginning on or after April 1, 2012.

However,considering the necessary lead time, Chairman Nishikawa noted it was no longer possible to start
applying the standard from the proposed original effective date.
a.

The Board discussed its comment on the IASB exposure draft on the mandatory effective date of
IFRS 9.
The exposure draft proposes to delay the mandatory effective date of IFRS 9 to the annual periods
beginning on or after January 1, 2015. The Board considered accepting the delay of the effective
date as long as certain conditions were met.
The Board also discussed its own standard on classification and measurement of financial assets.
The Board previously considered the amendments based on IFRS 9.

However, given the recent

development including the FASB’s exposure draft, the Board agreed to potentially reconsider its
approach as appropriate.

Following which, cash flow characteristics and business model werediscussed.
With regard to classification and measurement of financial liabilities, the differences between the
FASB’s decisions to date and the treatment under IFRS 9 were analyzed and discussed.
b.

An outline was presented regarding IFRS 12 Disclosures of Interests in Other Entities, and theBoard then discussed potential impacts if IFRS 12 were introduced in Japan.
Among other disclosure items required in IFRS 12, the discussion mainly focused on “joint
ventures and associates”, “subsidiaries with material non-controlling interests”, and “structured
entities.”

These items are viewed as key changes or of importance, compared to the current

Japanese standard.

(2) 233th Meeting (held on November 18, 2011)a. Discussion on the IASB Agenda Consultation documentb. Progress of the Technical Committee for SPEs and Consolidationc. Progress of the Technical Committee for Financial Instrumentsa.

The Board discussed its draft comment letter on the IASB’s Agenda Consultation document,
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which requests inputs on the strategic direction and overall balance of the IASB’s work plan, andon the priority of individual projects or agenda areas over the next three years.
The draft comment suggests that the focus over the next three years should be on the“Maintenance of the Existing IFRSs”.
The draft comment suggests the following issues should be addressed as agenda: (1) OCI andrecycling, (2) Scope of items to be measured at fair value, (3) Recognition of development costs
as assets, (4) Non-amortization of goodwill, (5) Reversal of impairment of fixed assets, and (6)Functional currency.
Additionally, at the beginning of the discussion, ASBJ Chairman Ikuo Nishikawa spoke regarding the“Council on Agenda Consultation.”stronger voice from Japan.

The Council was established with the aim of delivering a

Members of the Council include the ASBJ, the Japanese Institute ofCertified Public Accountants (JICPA), Japan Business Federation (Nippon Keidanren), the Securities
Analysts Association of Japan (SAAJ), Tokyo Stock Exchange, the Ministry of Economy, Trade andIndustry and the Ministry of Justice, with the FASF and the Financial Services Agency (FSA) as
Secretariats.

Chairman Nishikawa noted that the Council had discussed issues to convey consistentviews, and that the ASBJ’s draft comments had been prepared in light of views of the market
constituents.
b.

The Board discussed the IASB exposure draft Investment Entities, issued on August 25, 2011c.

The status of the IASB’ discussion relating to IFRS 9 was reported.
Regarding the amendment to defer the mandatory effective date of IFRS 9, the IASB tentatively
decided that the effective date are deferred to the annual periods beginning on or after January 1,
2015, and that early application is still permitted.
Regarding the restatement of comparative-period financial statements for the initial application,
the IASB received comments that indicated costs and other issues to arise from the restatement.
Consequently, the IASB decided not to require the restatement, but instead require modified
disclosures on transition to IAS 39 to IFRS 9.

2. ASBJ’s Comment Submitted to the IASB
The Accounting Standards Board of Japan (ASBJ) submitted comment letters on IASB Exposure
Draft Improvements to IFRSs and Exposure Draft Mandatory Effective Date of IFRS 9, on October
21, 2011, as well as on IASB Request for Views Agenda Consultation 2011, on November 30, 2011.

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3. The 14th Joint Meeting with the IASB Held in London
Representatives of the International Accounting Standards Board (IASB) and the AccountingStandards Board of Japan (ASBJ) held their fourteenth biannual meeting in London on October 31
and November 1, 2011.
The meeting provided the first formal opportunity for the Boards to meet since the appointment of
Mr. Hans Hoogervorst and Mr. Ian Mackintosh in July 2011 as the IASB’s Chair and Vice-Chair
respectively.
The Boards discussed the joint work of the IASB and the US Financial Accounting Standards Board(FASB), to improve International Financial Reporting Standards (IFRSs) and US generally accepted
accounting principles (GAAP) and to bring about their convergence.
During the meeting, the Boards exchanged views on the following projects undertaken by the IASB
and the FASB:•

Financial instruments (including the credit impairment model for financial assets)•

Revenue recognition(*) (including the recent deliberations that will lead to the re-exposure draft
expected to be issued during the fourth quarter of 2011)•

Leases (including the recent deliberations that will lead to the re-exposure draft expected to beissued in the first quarter of 2012)•

Investment entities (regarding the exposure draft, Investment Entities, published by IASB in
August 2011).

The IASB and the ASBJ also discussed interpretative and practical issues relating to the voluntary
application of IFRSs in Japan.
In addition, the ASBJ and the IASB exchanged views regarding the Agenda Consultation 2011 theIASB is undertaking to gather views on the strategic direction and the priority of agenda areas overthe next three years.
The next joint meeting is planned for early in the second quarter of 2012 in Tokyo.
(*)

Revised exposure draft on revenue recognition was issued on November 14, 2011

4. The 11th China-Japan-Korea Meeting
The accounting standard setter meeting of China, Japan, and Republic of Korea was held in Xiamen,
China on October 26, 2011. Ms. Yang Min, the Secretary-General of China Accounting Standard
Committee, Mr. Ikuo Nishikawa, the Chairman of Accounting Standards Board of Japan, Mr. Lim
Suk Sig, the Chairman of Korea Accounting Standards Board, International Accounting Standards
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Board (IASB) members Mr. Zhang Wei-guo and Mr. Takatsugu Ochi, as well as thirty otherdelegates from these countries joined the meeting. In addition, the meeting welcomed delegatesfrom Hong Kong and Macau as observers. During the meeting, attending delegates had a valuable
discussion regarding the latest developments of the international convergence of accounting
standards, IASB projects and its future agenda, and prospective efforts of the Asian-OceanianStandard Setters Group (AOSSG), and reached consensus of the following:(1) Standard setters of the three countries will maintain communicating process and efforts instandard-setting process and convergence projects, while keeping the other countries updated.
During the communication, it’s expected that the three countries will share their experience inresolving issues arising from standard development and enforcement process.
(2) Standard setters of the three countries will seek to coordinate their views on the IASB’s projects
whilst they respectively submit comments to the IASB regarding technical issues arising from thoseprojects.
(3) Standard-setters of the three countries will work together to enhance and reinforce regional
communication and cooperation in the Asian-Oceania region and commit joint efforts to improve the
AOSSG to make this organization a vital platform for regional involvements of standard-setting
process of IFRSs.
In addition, attending delegates agreed that they are willing to provide full support for the IASB’s
Asian-Oceanian regional liaison office in Tokyo planned to launch in October 2012.
The next China-Japan-Korea Accounting Standards Setters’ Meeting will be held in Korea in 2012.

5. The 3rd AOSSG Meeting Held in Melbourne
On 23 and 24 November, 2011, the third annual meeting of the Asian-Oceanian Standard-Setters
Group (AOSSG) was held in Melbourne, Australia.

The meeting was attended by 67

representatives from twenty-two AOSSG member countries or jurisdictions. From the ASBJ, Mr.
Ikuo Nishikawa (Chairman), Mr. Atsushi Kato (Vice Chairman), Mr. Takehiro Arai (Vice Chairman),
Mr. Masao Yanaga, (Board Member) and staff members attented.

Representatives of the IASB also

attended the meeting, including Mr. Hans Hoogervorst (Chairman), along with Mr. Takatsugu Ochi
(Board Member), Mr. Prabhakar Kalavacherla (PK) (Board Member) and Mr. Zhang Wei-Guo(Board Member).
Since the second meeting in Tokyo in September 2011, the ASBJ had served as Chair of the AOSSG
and the AASB as Vice Chair.

At this meeting, the AASB was confirmed as new Chair, and theHong Kong Institute of CPAs (HKICPA) Financial Reporting Standards Committee was elected as
new Vice Chair.
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In addition, the Memorandum of Understanding (MoU) of the AOSSG was revised to extend theterms of the Chair and the Vice Chair from one to two years. Furthermore, based on the Vision
Paper issued in June 2011, views were exchanged on the organization’s future operation.
With regard to technical issues, the IASB members provided an update on recent activities.

And

then, the AOSSG members, along with the IASB members, exchanged views on Revenue
Recognition, Insurance Contracts, Financial Instruments, Consolidation, Agriculture, Islamic
Finance, Emission Trading Schemes, Foreign Currency, Agenda Consolation, Leases, and DiscountRates.

6. The FASF Released the Launch of Accounting Human Resource
Development Program
The FASF finds it increasingly important for Japan to show its presence to the world, in developing
global accounting standards, as well as to request to take into consideration Japanese circumstances.
To enable this, it is necessary to develop accounting professionals, particularly professionals on a
global stage, on a mid- to long-term and the “All-Japan” basis.

As a part of such initiatives, the“Human Resource Development Task Force” was established within the FASF in August 2011, to
discuss action plans.
Members of the Task Force include representatives from the Japanese Institute of Certified Public
Accountants (JICPA), Japan Business Federation (Nippon Keidanren), the Securities Analysts
Association of Japan (SAAJ), major accounting firms, former IASB Board Tatsumi Yamada, and the
ASBJ Board Members. The Financial Services Agency (FSA) also attended the meeting as anobserver.
After discussions during five meetings, the Task Force prepared and released a support program todevelop accounting human resources.
The program is scheduled to start in January 2012.

7. Additional Appointment of Councillor of the FASF
The FASF held the Board of Councillors Meeting, and the Board voted to appoint Hiroshi Hirose(Vice Chairman, Sumitomo Chemical, Co., Ltd.) as an additional Councillor of the FASF, effective
on November 8, 2011.

8. The Establishment of Other Committees (Nominating and Evaluating
Committee, and Due Process Oversight Committee, and Operation Supportingpg. 6
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Committee)
The FASF held the Board of Directors Meeting on November 18, 2011. The Board voted toestablish “other committees” as prescribed in Article 65-2 of the FASF Constitution (Nominatingand Evaluating Committee, Due Process Oversight Committee, and Operation Supporting
Committee) and appointed chairmen and members of each committee respectively.
(1) Nominating and Evaluating Committee
Duty: Select candidates for Members and Chairman of the Accounting Standards Board of Japan(ASBJ), and recommend to the Board of Directors.

Evaluate performance of ASBJ Board

Members and Chairman during their terms, and report to the Board of Directors.
Members of the Committee:
Chairman

Muneharu Otsuka

Professor, School of Commerce, Waseda University(Director of FASF )MemberMemberMemberMemberHiroyuki Iwakuma

Senior Executive Vice President & COO, Tokyo(Director of FASF)

Stock Exchange Group, Inc.

Shinichi Taniguchi

Representative Director and Executive Vice President,(Director of FASF)

Nippon Steel Corporation

Shozo Yamazaki

Chairman and President, The Japanese Institute of(Director of FASF)

Certified Public Accountants

Hiroshi Hirose

Vice Chairman, Sumitomo Chemical, Co., Ltd.

(Councillor of FASF)
MemberTsuguoki Fujinuma

Vice

Chairman &Senior Executive(Councillor of FASF)

Japanese Bankers Association

Director,(2) Due Process Oversight Committee
Duty: Oversee the ASBJ’s development of standards to ensure they comply with the prescribed due
process and report to the Board of Directors.
Members of the Committee:
ChairmanKeiko Kitamura

Professor of Faculty of Commerce, Chuo University

MemberGen Ikegami

Deputy President, The Japanese Institute of Certified
Public Accountants

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Member

Akiyoshi Oba

President& CEO, Tokio Marine Asset Management
Co., Ltd.

Member

Masakazu Kubota

Senior Managing Director, Nippon Keidanren

MemberNoriaki ShimazakiSpecial Adviser, Sumitomo Corporation

MemberYoshiaki Nishimura

President, Tokai Rubber Industries, Ltd.

(3) Operation Supporting Committee
Duty: Manage the operation of the FASF Secretariat and the ASBJ (excluding development ofstandards) to support the FASF President in performing his duty.
Members of the Committee:
ChairmanIkuo Nishikawa

Chairman, The Accounting Standards Board of Japan

Member

Hideo Takahashi

Managing

Director,

The

Financial

AccountingStandards Foundation
MemberTakehiro Arai

Vice Chairman, The Accounting Standards Board ofJapan

MemberAtsushi Kato

Vice Chairman, The Accounting Standards Board ofJapan

9. FASF Hosted Constituents Gathering on the IFRS Foundation/IASBThe FASF hosted a constituents gathering to share an update on the IFRS Foundation/IASB, at theImperial Hotel, Tokyo, on December 1, 2011.
Representatives of the IFRS Foundation presented an update on activities and issues of their bodies
to attending constituents. The representatives included Mr. Tsuguoki Fujinuma (IFRS Foundation
Trustee), Mr. Noriaki Shimazaki (IFRS Foundation Trustee), Mr. Takatsugu Ochi (IASB Board
Member), Mr. Kazuo Yuasa (IFRS Interpretations Committee Member), Mr. Shozo Yoneya (IFRS
Advisory Council Member) and Mr. Sei-Ichi Kaneko (IFRS Advisory Council Member), along with
Mr. Hiroshi Yamada (Global Preparer Forum Member) and Mr. Tetsujiro Ishiguro (Global Preparer
Forum Member).

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10. FASF Seminar on Disclosure for New Practitioners
The FASF had conducted a survey among the FASF seminar attendants, to gather inputs on
improvement to seminar events. Many respondents requested a new kind of seminar, one providing
an overview of disclosures to support those who are new to the practice, in addition to the FASF’s
traditional seminars which focus on the amendments to the guide to the preparation of securities
reports and others,
In response to these requests, the FASF held a “Seminar on Disclosure for New Practitioners.”

The

seminar was designed to assist seminar participants in utilizing FASF’s “Guide to the Preparation ofAnnual Securities Reports” and a “Guide to the Preparation of Quarterly Reports.”

It focused on“Fundamentals of Disclosure,” such as relevant regulations and the related system.

The seminar

was available for those with FASF Membership.
Date

Venue

Location

December 14, 2011

Bellesalle HanzomonTokyo

December 15, 2011

Nagoya Congress Center

NagoyaDecember 16, 2011

Osaka International Convention Center

Osaka

December 21, 2011

Bellesalle Hanzomon

Tokyo

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“ASBJ Newsletter” (No. 24)
Issued on January 19, 2012
Editor: Shousaku Shimomura
The views expressed in ASBJ Newsletter are not necessarily those of the ASBJ or the FASF. The
Authors and Publishers accept no responsibility for any loss or damage resulting from reliance on theviews expressed herein.
© Copyright, ASBJ/FASF All Rights Reserved
Website: https://www.asb.or.jp/asb/index_e.jsp
E-mail: publicity@asb.or.jp
Accounting Standards Board of Japan / Financial Accounting Standards Foundation
Fukoku Seimei Building 20F, 2-2, Uchisaiwaicho 2-chome, Chiyoda-ku, Tokyo, Japan (Zip Code:
100-0011)

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