Regulation (EC) No. 1606/2002 of the European Parliament (the Regulation) requires all listed European companies to prepare their consolidated financial accounts in accordance with EU adopted International Financial Reporting Standards (IFRS) - formerly known as International Accounting Standards (IAS) - for accounting periods commencing on or after 1 January 2005. The accounting standard "IFRS 9" has been effective since 1 January 2018.
In respect of the relevant accounting standards, I note that a previous accounting standard, International Accounting Standard 39, required the use of an incurred loss approach for the calculation of impairment provisions resulting in impairment provisions being recognised only when losses are incurred and not before then. Under the expected loss approach (“expected loss model”) set out in IFRS 9 (which is applicable for accounting periods starting on or after 1 January 2018) it is no longer necessary for there to be a loss event to occur before an impairment loss is recognised.
The Office of the Director of Corporate Enforcement (ODCE) is responsible overseeing compliance with obligations imposed by the Companies Acts in respect of the maintenance of proper books of account and the preparation and publication of accounts.
Furthermore, the Irish Auditing and Accounting Supervisory Authority (IAASA) is the independent body responsible for the enforcement of accounting standards including the examination and enforcement of certain listed entities’ (entities whose securities have been admitted to trading on a regulated market situated, or operating, within the EU) periodic financial reporting.
As both the ODCE and IAASA are within the remit of the Companies Acts, any queries in relation to them should be addressed to my colleague the Minister for Business, Enterprise and Innovation.
