Issued May 20, 2014 (No. 38)

Contents
1. New ASBJ Pronouncements (released between February 1 and March 31, 2014)
2. Overview of ASBJ Meetings (281st – 284th Meeting)
3. The Accounting Standards Advisory Forum (ASAF) Meeting held in London
4. ASBJ attended the Meeting of the International Forum of Accounting Standard
Setters (IFASS)
5. Release of Guideline for Accounting of SMEs (2013)
6. Yukio Ono appointed as Chairman of the ASBJ
7. Appointment of Members of the Operation Supporting Committee
8. The 20th Standards Advisory Council Meeting
9. ASBJ Open Seminar “Hearing from IASB Chairman Hans Hoogervorst”

pg. 1
Copyright© ASBJ/FASF All Rights Reserved.

1. New ASBJ Pronouncements (released between February 1 and March 31,2014)(1) [ED] Release of Exposure Draft of Proposed Amendments to ASBJ Statement No.12 AccountingStandard for Quarterly Financial Reporting (Exposure Draft of Statement No.56) and ASBJ
Guidance No.14 Guidance on Accounting Standard for Quarterly Financial Reporting (ExposureDraft of Guidance No.51) (February 25, 2014)(2) [ED] Release of Exposure Draft of PITF No.40 Practical Solution on Accounting for Leases bylessees under the New Measures to Promote Investment in Facilities Using Lease Methods(March 7, 2014)[Legend]
ED: Exposure Draft
Final: Statement/Guidance etc. (final version)

2. Overview of ASBJ Meetings (281st – 284th Meeting)(1) 281st Meeting (held on February 7, 2014)
a. Updates on the IASB’s progress on its Leases projectb. Progress of the Working Group for Endorsement of IFRSs
c. Amendments to Accounting Standard for Quarterly Financial Reporting in relation to Revised
Accounting Standard for Business Combinationsa.

The Board reviewed alternative approaches discussed by the International Accounting Standards
Board (IASB) and the Financial Accounting Standards Board (FASB) at their joint board meeting
held in January 2014. The Board then discussed what views to express on those approaches,
referring to the ASBJ’s previous comment letter to the IASB and the FASB.

b.

The Board continued to review the progress made by the Working Group for Endorsement ofIFRSs (Working Group) on detailed analyses in the selection of ‘possible items for consideration’,as well as grouping of the issues for further consideration in light of the detailed analyses.

c.

The Board discussed planned amendments to Accounting Standard for Quarterly Financial
Reporting and related guidance in relation to the amendments to the provisional accounting
treatment in Revised Accounting Standard for Business Combinations, issued on September 13,
2013.
(2) 282nd Meeting (held on February 24, 2014)
a. Planned responses to the March 2014 meeting of the ASAF
b. Release of Exposure Draft of Practical Solution on Accounting for Leases by lessees under thepg. 2
Copyright© ASBJ/FASF All Rights Reserved.

New Measures to Promote Investment in Facilities Using Lease Methods [approval for release]c. Release of Exposure Draft of Proposed Amendments to Accounting Standard for Quarterly
Financial Reporting and Guidance on Accounting Standard for Quarterly Financial Reporting[approval for release]d. Progress of the Technical Committee for Deferred Tax Accounting
e. Overview of the IASB’s Request for Information on Post-implementation Review of IFRS 3
Business Combinationsa.

The Board discussed what views to express at the March 2014 meeting of the AccountingStandards Advisory Forum (ASAF), after being presented with an outline of agenda papers for themeeting on conceptual framework, leases, and disclosure initiative.

b.

The Board voted on and approved the issuance of the Exposure Draft of Practical Solution onAccounting for Leases by lessees under the New Measures to Promote Investment in Facilities
Using Lease Methods.

c.

The Board voted on approved the issuance of the Exposure Draft of Proposed Amendments toAccounting Standard for Quarterly Financial Reporting and Guidance on Accounting Standardfor Quarterly Financial Reporting.

d.

The Board discussed how the ASBJ should take over practical guidelines on accounting fordeferred taxes developed by the Japanese Institute of Certified Public Accountants (JICPA), basedon discussions by the Technical Committee for Deferred Tax Accountingd.

The Board discussed how to respond to the IASB’s Request for Information (RFI) on
Post-implementation Review: IFRS 3 Business Combinations, issued on January 30, 2014, after
being presented with its outline.
(3) 283th Meeting (held on March 12, 2014)
a. Administrative matters (closed session)c. Report on the March 2014 meeting of the ASAF
c. Progress of the Working Group for Endorsement of IFRSsa.

The Board discussed the ASBJ’s operating plan and budget for the coming fiscal year.

b.

An outline of the discussions at the ASAF meeting held in London on March 3 and 4, 2014 waspresented.

c.

The Board reviewed a summary of arguments about non-amortization of goodwill.

It alsodeliberated the items that warranted further considerations, based on the discussions by theWorking Group.

pg. 3
Copyright© ASBJ/FASF All Rights Reserved.

(4) 284th Meeting (held on March 27, 2014)
a. Report from the Standards Advisory Council
b. Updates on the IASB’s progress on its Leases projectc. Progress of the Working Group for Endorsement of IFRSs
d. Response to tax reforme. Progress of the Technical Committee for Deferred Tax Accountinga.

The Standards Advisory Council recommended the ASBJ to conduct a limited review of hedge
accounting as its new agenda item.

b.

The Board was presented with an outline of the development of the IASB and FASB’s leaseprojects during their joint board meeting held in March 2014.

c.

The Board reviewed the items that warranted further considerations, based on the discussions bythe Working Group.

d.

It also reviewed the application of IFRS in other countries.

The Board discussed clarification of the effects of 2014 tax reform on determination of effective
tax rates.

e.

The Board discussed issues related to the existing JICPA’s practical guidelines identified bymembers of the Technical Committee for Deferred Tax Accounting, as well as an overall pictureof how the ASBJ should take over the guidelines.

3. The Accounting Standards Advisory Forum (ASAF) Meeting held in London
The Accounting Standards Advisory Forum (ASAF) Meeting was held in London on March 3 and 4,
2014.

The ASAF was established in April 2013 to provide technical advice to the IASB, and it

consists of twelve organizations, including the ASBJ.

The meeting was attended by representativeof these twelve originations, as well as IASB Chairman Hans Hoogervorst, Vice Chairman Ian
Mackintosh, and a number of IASB Board Members and Staff members.

The ASBJ wasrepresented by former Chairman Ikuo Nishikawa.
During the meeting, active discussions were conducted on the following topics:z

Conceptual Framework (A Revised Model for Presentation in the Statement(s) of FinancialPerformance)z

Conceptual Framework (Development of the Exposure Draft for the Conceptual Framework)z

Conceptual Framework (Complexity)z

Leasesz

Disclosure Initiativez

Insurance Contracts

pg. 4
Copyright© ASBJ/FASF All Rights Reserved.

zRate-regulated Activities

zOthers

The next meeting is scheduled for June 2 and 3, 2014 in London.

4. ASBJ attended the Meeting of the International Forum of Accounting Standard
Setters (IFASS)The International Forum of Accounting Standard Setters (IFASS) Meeting was held on March 3 and7, 2014 in New Delhi, India.

The meeting was attended by 73 representatives from 40 nationalaccounting standard setters and regional groups, including from the United Kingdom, the UnitedStates, Canada, France, Germany, Australia, Korea, India, and Singapore.

The ASBJ wasrepresented by former Chairman Ikuo Nishikawa, Vice Chairman Atsushi Kogasaka, Board Member
Tomo Sekiguchi and Technical Manager Misa Ota.
The purpose of the forum is to discuss research projects undertaken by national standard setters andto provide input into, and support for the development of IASB standards.

The meeting is held

twice a year (in Spring and in Fall).
The following topics were discussed at the meeting:
AgendaSpeaker

March 6, 2014
IASB Work Plan and IFRS Foundation recent developments
1(1) General discussion of the status of projects

IASB, Canada(2) Interpretation and implementation guidance,

Germany, IASB

Report on criteria for including issues in annualimprovements process
Reports on projects from members
2(1) Role of the business model in financial reporting

EFRAG, France, UK(2) Goodwill impairment and amortization project

EFRAG, Japan, India,
Italy

3

Update from the International Public Sector Accounting

IPSASB

Standards Board
Conceptual Framework

4(1) Role of conceptual framework

New Zealand(2) Presentation in the statement of financial performance

FASBand its relation to measurement(3) Insight into measurement section

IASBpg. 5Copyright© ASBJ/FASF All Rights Reserved.

Update of the Statement of Best Practice
5IFASS Chairman(1) Relationship of the IASB and the other accounting
standard-setters(2) IFASS Charter

March 7, 2014
IASB updates on major agenda projects
6

IASB(1) Leases(2) Financial Instruments(3) Disclosure Initiative
Topical issues

7(1) Discount rate

Germany(2) Application issues related IFRS 11 Joint Arrangements

Italy(3) Macro Hedging

Australia(4) Separation of embedded derivatives under international

India

competitive bidding(5) Equity method: a measurement basis or one-line

EFRAG

consolidation?
8Reports from regional groupsz

AOSSGzEFRAGzGLASSzPAFARegional Groups

New projects by members
91011(1) Statement of cash flows

UK(2) Complexity of the annual report

EFRAG(3) Use of financial information by capital providers

EFRAG

The contribution of accounting standards to social andSierra Leone

economic development: opportunities and threats
IFASS administrative matters

IFASS Chairman

5. Release of Guideline for Accounting of SMEs (2013)
The Committee for Development of Guidelines for Accounting of Small and Medium-sized Entities(hereafter “the Committee”), established under the joint initiative of the Japanese Institute ofCertified Public Accountants (JICPA), the Japan Federation of Certified Public Tax Accountants’
Associations (JFCPTAA), the Japan Chamber of Commerce and Industry (JCCI) and the AccountingStandards Board of Japan (ASBJ), had reviewed the “Guidelines for Accounting of Small andpg. 6
Copyright© ASBJ/FASF All Rights Reserved.

Medium-sized Entities (hereafter “the Guideline for accounting of SMEs”).

Following theapproval of the release of the revised guidelines at the Committee meeting held on January 29, 2014,
the “Guidelines for Accounting of SMEs (2013)” was issued, dated February 3, 2014.
The revised guidelines include the updated terminology, mainly to reflect ASBJ Statement No. 26
Accounting Standard for Retirement Benefits, among other accounting standards issued by the ASBJ.
The four organizations agreed to conduct an annual review of and revision to the Guideline foraccounting of SMEs, in order to enhance rationality and reflect economies of transactions.

It isanticipated that joint efforts by the constituents to foster a wider use of the guideline could contributeto improving the quality of accounting of SMEs, and thus to facilitating a sustainable economic
growth and building an economic foundation.

6. Yukio Ono appointed as Chairman of the ASBJThe Financial Accounting Standards Foundation (FASF) held the Board of Directors Meeting onMarch 14, 2014, and it approved the appointment of Yukio Ono as Chairman of the AccountingStandards Board of Japan (ASBJ), effective April 1, 2014, as prescribed in Article 57, paragraph 1 ofthe FASF Constitution. Mr. Ono succeeds former Chairman Ikuo Nishikawa.

Mr. Ono’s term

ends on March 31, 2016, as prescribed in Article 59, paragraph 2 of the FASF Constitution.

7. Appointment of Members of the Operation Supporting Committee
At the FASF Board of Directors Meeting held on March 13, 2014, appointment of a Member of theOperation Supporting Committee was approved, as prescribed in Article 65-2, paragraph 2 of theFASF Constitution.

The composition of the Committee, beginning April 1, 2014, is as follows:(New appointees are underlined)
zOperation Supporting CommitteeChairMasaji Miyako

Managing Director of the Financial Accounting Standards
Foundation

MemberYukio Ono

Chairman of the Accounting Standards Board of Japan

MemberTakehiro Arai

Vice Chairman of the Accounting Standards Board of Japan

MemberAtsushi Kogasaka

Vice Chairman of the Accounting Standards Board of Japanpg. 7
Copyright© ASBJ/FASF All Rights Reserved.

*Mr. Ikuo Nishikawa retired as member, dated March 31, 2014.

8. The 20th Standards Advisory Council Meeting
On March 18, 2014, the 20th Standards Advisory Council (the Council) Meeting was held.
At this meeting, the Council deliberated on its responses to possible agenda items which had beensuggested at the previous meetings, and then decided to recommend the ASBJ for a limited review ofHedge Accounting.

The Council had previously requested the Practical Solutions Standing

Committee (the Committee) to assess the topic, and the Committee had concluded its assessment.
The Committee observed that some items were worthy of consideration although it was expected toface some difficulties in the development.
The Council also received several new suggestions, namely “How a parent voluntarily applying thedesignated IFRSs should determine appropriate carrying amounts of assets acquired and liabilities
assumed from its subsidiary which it merges” and “Accounting for Accelerated Share Repurchase(ASR Transaction)”.

After discussion, the Council decided to request the Practical Solutions

Standing Committee to assess these topics.
In addition, the ASBJ provided an update on its recent activities.

The Council members thenexchanged views on the report.

9. ASBJ Open Seminar “Hearing from IASB Chairman Hans Hoogervorst”
On February 5, 2014, the ASBJ held an open seminar, featuring a speech by IASB Chairman Hans
Hoogervorst, who visited Japan to meet constituents. The seminar took place at the Iino Hall inTokyo.
The seminar featured a speech by Chairman Hoogervorst, titled “Profit or Loss and OCI... can it bedone?”, as well as the IASB’s updates on the development of pronouncements (including Revenue
Recognition, Conceptual Framework, and Leases) by IASB Board Member Takatsugu Ochi.

pg. 8
Copyright© ASBJ/FASF All Rights Reserved.

“ASBJ Newsletter” (No. 38)
Issued on May 20, 2014
The views expressed in ASBJ Newsletter are not necessarily those of the ASBJ or the FASF. TheAuthors 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)

pg. 9
Copyright© ASBJ/FASF All Rights Reserved.