EFRAG publishes Final Comment Letter on the IAS 28 Fair Value Option Exposure Draft and supports the IASB’s proposals
EFRAG has published its Final Comment Letter (FCL) on the IASB's Exposure Draft (ED) Amendments to the Fair Value Option for Investments in Associates and Joint Ventures - proposed amendments to IAS 28.
Based on the feedback received during the consultation, EFRAG supports the proposed Exposure Draft amendments. These aim to address insurers’ concerns regarding divergent interpretations of the term ‘similar entities’ in paragraphs 18 and 19 of IAS 28 Investments in Associates and Joint Ventures, and the resulting impact on classification under IFRS 18 Presentation and Disclosure in Financial Statements.
At the same time, EFRAG acknowledges that stakeholders hold differing views on the appropriate scope of the proposed amendments, as well as on the interpretation of their wording. Therefore, EFRAG suggests areas for the IASB to further clarify to ensure consistent understanding and application of the amendments. Regardless, EFRAG reiterates its support for the proposed amendments.