IASB publishes proposals on rate-regulated activities
23 July 2009
The proposed IFRS would define regulatory assets and regulatory liabilities; set out criteria for their recognition; specify how they should be measured; and require disclosures about their financial effects.
The International Accounting Standards Board (IASB) today published for public comment proposals on the accounting for rate-regulated activities.
The objective of the proposals is to establish how assets and liabilities resulting from rate-regulated activities should be recognised and measured under International Financial Reporting Standards (IFRSs). If adopted, the proposed IFRS would:
- define regulatory assets and regulatory liabilities;
- set out criteria for their recognition;
- specify how they should be measured; and
- require disclosures about their financial effects
The IASB was asked for guidance on the issue from many jurisdictions. Clarifying the accounting for rate regulation is of particular importance for jurisdictions that are in the process of adopting IFRSs and where accounting for the effect of rate regulation is in place for some sectors. In those cases, entities are currently recognising sometimes significant ‘regulatory’ assets and liabilities by reference to the specific US standard.
Deadline for comments is 20 November 2009.
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