Issued May 20, 2013 (No. 32)

Contents

1. Overview of ASBJ Meetings (259th Meeting – 261st Meeting)
2. ASBJ’s Comment Submission to the IASB (February 1, 2013 – March 31,
2013)
3. Release of Accounting Guideline for SMEs (2012)
4. Appointment of Members of the ASBJ and the SAC
5. Appointment of the Chair and Members of Operation Supporting
Committee
6. ASBJ elected as an inaugural member of the ASAF
7. The 17th Standards Advisory Council Meeting
8. ASBJ held Open Seminar – February and March 2013

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1. Overview of ASBJ Meetings (259th Meeting – 261st Meeting)(1) 259th Meeting (held on February 6, 2013)
a. Overview of the IASB’s Feedback Statement on Agenda Consultation 2011, and the ASBJ’splanned responses
b. Progress of the Practical Solutions Standing Committeec. Progress of the Technical Committee for Financial Instruments
d. Responses to the IASB’s Exposure Draft of Annual Improvements to IFRSsa.

In December 2012, the IASB issued a feedback document on Agenda Consultation 2011. The
ASBJ Board members were presented with an overview of the document and discussed how to
respond to it.
The feedback document states that the IASB will focus on three areas: (1) implementation andmaintenance, (2) the Conceptual Framework, and (3) a small number of major IFRS projects.
The Board agreed to give priority to consideration on the Conceptual Framework project because
it relates to subjects of great interest to Japanese constituents.

b.

The Board was presented with the progress by the Practical Solutions Standing Committee, on‘scheme of granting a company’s own shares to its employees through a trust.’
The Committee addresses accounting for this scheme, by classifying schemes into two categories:(1) a scheme transferring shares to an employee stock ownership plan through a trust, and (2) ascheme entitling employees to receive shares through a trust.

c.

The Board discussed draft comments on the IASB’s Exposure Draft Classification andMeasurement: Limited Amendments to IFRS 9 (Proposed amendments to IFRS 9 (2010)).

d.

The Board discussed draft comments on the IASB’s Exposure Draft on Annual Improvements to
IFRSs.

(2) 260th Meeting (held on March 12, 2013)a. Discussion on Accounting Standard for Intangible Assets
b. Progress of the Technical Committee for SPEs and Consolidationc. Discussion on the IASB’s Exposure Draft Equity Method: Share of Other Net Asset Changes andExposure Draft Clarification of Acceptable Methods of Depreciation and Amortisationd. Progress of the Technical Committee for Financial Instrumentsa.

Staff outlined practices under US GAAP and IFRS regarding identification and valuation of
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Copyright© ASBJ/FASF, All Rights Reservedintangible assets, such as brands and customer relationships, acquired in business combinations.
The Board then discussed the benefits of identifying those intangible assets.
b.

The Board reviewed a draft paper “Progress Report on Deliberation on Scope of Consolidation ofSpecial Purpose Entities and other matters,” which is an interim report to summarize the progress
made by the Technical Committee for SPEs and Consolidation.

c.

The Board discussed draft comments on the IASB’s Exposure Drafts Equity Method: Share of
Other Net Asset Changes (Proposed amendments to IAS 28) and Clarification of Acceptable
Methods of Depreciation and Amortisation (Proposed amendments to IAS 16 and IAS 38).

d.

The Board discussed draft comments on the IASB’s Exposure Draft Classification andMeasurement: Limited Amendments to IFRS 9, as well as on the FASB’s Exposure Draft Credit
Losses.

(3) 261st Meeting (held on March 29, 2013)
a. Agenda item proposals from the Standards Advisory Council
b. Progress of the Technical Committee for SPEs and Consolidationc. Progress of the Technical Committee for Financial Instruments (discussion on draft comments on(i) IASB Exposure Draft Classification and Measurement: Limited Amendments to IFRS 9, (ii)
FASB Exposure Draft Credit Losses, (iii) IASB Exposure Draft Novation of Derivatives andContinuation of Hedge Accounting)a

The Standards Advisory Council proposed two agenda items: (1) reconsideration of PITF No. 18
Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for
Consolidated Financial Statements and (2) consistency in the treatments of tax effect accounting
for the consolidated taxation system and those for business combinations.
With regard to PITF No.18, the Board will consider whether any additional items should be
adjusted in the consolidation process, in addition to the five items listed in the PITF.
With regard to tax effect accounting, the Board will deliberate on how to address the perceived
inconsistency in the treatments of tax effect accounting for the consolidated taxation system andthat for business combinations.
b. The Board reviewed the draft paper “Progress Report on Deliberation on Scope of Consolidationof Special Purpose Entities and other matters.”
The report was released on the ASBJ’s website, dated March 29, 2013.

c.

The Board discussed draft comments on the IASB’s Exposure Drafts and the FASB’s Exposure
Draft.
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(i) IASB Exposure Draft Classification and Measurement: Limited Amendments to IFRS 9: theBoard discussed draft comments. The ASBJ submitted its comment letter to the IASB, dated
March 29, 2013.
(ii) FASB Exposure Draft Credit Losses: the Board discussed draft comments on the FASB’s
exposure draft, in which a single impairment model is proposed, although the IASB and the FASB
originally had a joint deliberation on the three-bucket impairment model.
(iii) IASB Exposure Draft Novation of Derivatives and Continuation of Hedge Accounting): theBoard discussed draft comments and are generally in favor of the proposals in the exposure draft.

2. ASBJ’s Comment Submission to the IASB (February 1, 2013 – March 31,
2013)
(1)

ASBJ submitted its Comment on the Exposure Draft “Annual Improvements to IFRSs
2011-2013 Cycle” (February 15, 2013)(2)

ASBJ submitted its Comments on the Exposure Draft “Equity Method: Share of Other Net
Asset Changes (Proposed amendments to IAS 28)” (March 22, 2013)(3)

ASBJ submitted its Comments on the Exposure Draft “Clarification of Acceptable Methods ofDepreciation and Amortisation (Proposed amendments to IAS 16 and IAS 38)” (March 29,
2013)

(4)

ASBJ submitted its Comments on the Exposure Draft “Classification and Measurement:
Limited Amendments to IFRS 9 (Proposed amendments to IFRS 9 (2010))” (March 29, 2013)

3. Release of Accounting Guideline for SMEs (2012)
The Preparation Committee for Accounting Guidelines for Small and Medium-sized Entities(hereafter “the Committee”), established under the joint initiative of the Japan Federation of
Certified Public Tax Accountants’ Associations (JFCPTAA), the Japanese Institute of Certified
Public Accountants (JICPA), the Japan Chamber of Commerce and Industry (JCCI) and the
Accounting Standards Board of Japan (ASBJ), had reviewed the “Accounting Guidelines for Smalland Medium-sized Entities.”

The purpose of the review was to update the guidelines in order toreflect the “Report by the Council on Accounting of Unlisted Companies” (released on August 30,2010) and the “Interim Report by Working Group on Accounting of Small and Medium-sized
Entities” (released on September 30, 2010).

Following the approval of the release of updated

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guidelines at its meeting held on February 13, 2013, the Committee released the “Accounting
Guidelines for Small and Medium-sized Entities (2012)” on February 22, 2013.
These updated guidelines make no changes to the accounting treatment, but are now rewritten witheasier expressions, with an aim to improved usability of the guidelines for management in light of
the recommendations by the two reports mentioned above.

4. Appointment of Members of the ASBJ and the SAC
The Financial Accounting Standards Foundation (FASF) held the Board of Directors Meeting on
March 18, 2013, and it approved the appointment and reappointment of members of the AccountingStandards Board of Japan (ASBJ) and members of the Standards Advisory Council (SAC).
The members of the ASBJ Board and the SAC following these appointments are as follows (newappointees are underlined)

Accounting Standards Board of Japan

ChairmanIkuo Nishikawa

Vice Chairman

Takehiro Arai *(full-time)
Vice Chairman

Atsushi Kogasaka *(full-time)
Board Member

Tomokazu Sekiguchi(full-time)
Board Member

Aiko Sekine

Partner, Pricewaterhousecoopers Aarata

Yoshihiro Tokuga

Dean and Professor of the Graduate School of(part-time)
Board Member(part-time)
Board Member

Management at Kyoto University
Yasuyuki Fuchita(part-time)
Board Member

Research
Hisayoshi Masawaki(part-time)
Board Member(part-time)

Executive Fellow, Nomura Institute of Capital Markets

Director, General Manager, Accounting Dept.,Sumitomo
Mitsui Finance and Leasing Co., Ltd.

Kazuyuki Masu

Senior Vice President, General Manager, Corporate
Accounting Dept., Mitsubishi Corporationpg. 5
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Board Member

Masao Yanaga(part-time)
Board Member

University of Tsukuba
Katsuhito Yanagibashi(part-time)
Board Member

Senior General Manager, Accounting Standards andSystem Promotion Center, Canon Inc.

Minoru Yoshida(part-time)
Board Member

Professor, Graduate School of Business Sciences,

Advisor, Corporate Accounting and Control, Asahikasei
Co.

Hitoshi Watanabe

General Manager, International Accounting and Actuarial
Affairs Office, Planning and Research Department,(part-time)

Nippon Life Insurance Co.
(Appointment effective April 1, 2013)* Mr. Arai and Mr. Kogasaka were appointed as Vice Chairmen by ASBJ Chairman Nishikawa,pursuant to Article 3 of the ASBJ Operation Rule, through the nomination by ASBJ Chairman andapproval by the Board at the 262th Board meeting in April.
DeputyYukio Ono

ChairmanPartner and Chairman of the Board, Deloitte Touche
Tohmatsu LLC(part-time)(Appointment effective October 1, 2013)Standards Advisory Council

Chairman

Kunio Nozaki

Managing Executive

Officer, Sumitomo Chemical

Co.,Ltd.
Vice Chairman

Seno Tezuka *Partner, Deloitte Touche Tohmatsu LLC

MemberTakahiro Ikoma

General Manager, Profit Management Department, The
Dai-ichi Life Insurance Company., Ltd.

Member

Hidetake Ishihara

General Manager, Accounting & Finance Div., Nippon
Steel & Sumitomo Metal Corporation

MemberYuichiro Kato

General Manager, Controller's Dept., Toray Industries,
Inc.

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Member

Goro Kumagai

Senior Fellow, Strategic Research Department, Mizuho
Securities Co.,Ltd.

MemberMakoto ShinoharaPartner, Ernst & Young ShinNihon LLC

MemberKazumi Suzuki

Professor, Graduate School of Business Administration,
Kobe University

MemberKoichi Takahata

Managing Executive Officer, Assistant General Manager,
Financial

Resources

Management

Group,

GeneralManager, Accounting Controlling Dept., Sumitomo
Corporation
MemberJunko Nakagawa

Senior Managing Director, Nomura Holdings, Inc.

MemberHidenori Hanada

General Manager, Accounting Dept., NKSJ Holdings,
Inc.

MemberHiroyuki Matsuzaki

Director of Listing Dept., Tokyo Stock Exchange, Inc.

Member

Kimitaka Mori

Partner, KPMG AZSA LLC

MemberHiroshi Yamada

Chief Accounting and Liaison Officer, General Manager,
Accounting Group, Panasonic Corporation

Member

Masaki Yoneyama

Professor, Graduate School of Economics, University ofTokyo(Appointment effective April 1, 2013)*Mr. Tezuka will be appointed as Vice Chairman through the nomination by the SAC Chairman,
pursuant to Article 65, paragraph 4 of the FASF Constitution.

5. Appointment of the Chair and Members of Operation Supporting Committee
At the FASF Board of Directors Meeting held on March 18, 2013, appointment of the Chair andMembers of the Operation Supporting Committee was approved, as prescribed in Article 65-2,
paragraph 2 of the FASF Constitution. Its members are as follows.
(New appointees are underlined)

Operation Supporting Committee

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ChairMasaji Miyako

Managing Director, The Financial Accounting Standards
Foundation

MemberIkuo Nishikawa

Chairman, The Accounting Standards Board of Japan

MemberTakehiro Arai

Vice Chairman, The Accounting Standards Board of Japan

MemberAtsushi Kogasaka

Vice Chairman, The Accounting Standards Board of Japan(Appointment effective April 1, 2013)

6. ASBJ elected as an inaugural member of the ASAF
The Accounting Standards Board of Japan (ASBJ) is pleased to announce that it has been elected as
an inaugural member of the Accounting Standards Advisory Forum (ASAF).
The ASAF was created as a result of the 2011 strategy review conducted by the IFRS Foundation
Trustees. The forum consists of twelve members from major national accounting standards settersand regional groups around the world, and will provide technical advice to the International
Accounting Standards Board (IASB). The ASAF and its membership will be reviewed after two
years. The initial membership of the forum is as follows:
RegionAfricaMemberSouth African Financial Reporting Standards Council, supported by
the Pan African Federation of Accountants (PAFA)

Asia-Oceania

Accounting Standards Board of Japan

Australian Accounting Standards Board

Chinese Accounting Standards Committee

Asia Oceania Standard Setters Group (AOSSG) , represented by theHong Kong Institute of Certified Public Accountants

EuropeThe Americas



Accounting Standards Committee of GermanyEuropean Financial Reporting Advisory Group (EFRAG)Spanish Accounting and Auditing Institute

United Kingdom Financial Reporting Council

Group of Latin American Standard Setters (GLASS), represented by
the Brazilian Committee of Accounting PronouncementsCanadian Accounting Standards Board

United States Financial Accounting Standards Board

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The first ASAF Meeting was held in London on 8 and 9 April, 2013.

The ASAF Meetings areopen to public, including via webcast. Meeting papers are made available on the IASB’s website.

7. The 17th Standards Advisory Council Meeting
On March 11, 2013, the 17th Standards Advisory Council (SAC) Meeting was held.
The meeting began with discussions on possible agenda items for the ASBJ’s consideration.

First,

the Council discussed the possible standard-level agenda items which had been suggested at theprevious meeting. It decided not to recommend the ASBJ to take up “comparative information” atthis time, but to continue to assess whether to recommend it as an agenda item for the ASBJ in the
future.
The Council then discussed the possible practical solutions level agenda items which had beensuggested at the previous meeting.

It decided to propose that the ASBJ take up ‘reconsideration of

PITF No. 18 Practical Solution on Unification of Accounting Policies Applied to Foreign
Subsidiaries for Consolidated Financial Statements’ and ‘tax effect accounting for the consolidated
taxation system and business combinations.’

In addition, it decided to further discuss theaccounting issues surrounding assessment of recoverability of deferred tax assets.

Also, it decided

to ask the Practical Solutions Standing Committee to assess accounting for additional retirement
benefits for early retirements, as well as accounting for restructuring (the Council received thesuggestion for this topic as a new item at this meeting). In addition to this, the Council received
suggestions for several other new topics (three standard-level topics and one practical solutions-level
topics).
Later in the meeting, the ASBJ provided an update on its recent activities and ongoing projects.
The Council members then expressed views and asked questions on the Business Combinations
project.

8. ASBJ held Open Seminar – February and March 2013
The ASBJ/FASF has hosted the ASBJ Open Seminar series since 2010. Through its work the ASBJ
is able to identify global trends in accounting in a timely manner. In the Open Seminar, the ASBJ
provides up-to-date information about these trends to improve services to members of the FASF.
During the most recent seminars held in major cities across Japan, the Financial Services Agency
presented recently proposed audit standards on responses to fraud risk as well as revisions to audit
standards.

The ASBJ then provided an update on its projects on Business Combinations andIntangible Assets, as well as on its international collaborations with other standard setters, focusingpg. 9
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on the IASB’s ongoing projects and the establishment of the Accounting Standards Advisory Forum(ASAF). In addition, the ASBJ provided an overview of the exposure draft of proposed AccountingStandards for Business Combinations and related matters, issued on January 11, 2013. More than
700 attendants across five locations joined the seminars.
In conjunction with these seminars, the ASBJ/FASF met to exchange views with Chubu Economic
Federation in Nagoya, and local audit firms in Osaka, Sapporo, and Fukuoka, promoting theirunderstanding of and support for the ASBJ/FASF.
The seminars were convened with the support from local stock exchanges.

Date

Location

Venue

February 21, 2013

Tokyo

Yomiuri Hall

February 22, 2013

Fukuoka

TKP TENJIN City CenterFebruary 25, 2013Osaka

TKP Osaka Umeda Business CenterFebruary 26, 2013

NagoyaDAITEC SAKAE

March 8, 2013

SapporoSapporo Securities Exchange

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“ASBJ Newsletter” (No. 32)
Issued on May 20, 2013
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: planning@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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