IASB Gets More Attention, Issues SIC-32
A survey of U.S. insurance executives conducted by Ernst & Young found that more than two-thirds (67%) of companies have someone tracking developments of the International Accounting Standards Board (IASB). In addition, almost half (44%) have someone within their organization participating on committees related to International Accounting Standards (IAS), and almost a third (30%) have developed an internal task force on IAS. The three top concerns of these executives are volatility of financial results, impact on profit emergence and onerous disclosure requirements.
"Insurance executives in the U.S. are just beginning to realize the potential implications of IAS standards on their organizations," said Mike McLaughlin, E&Y's Director of Life Actuarial Services. Over 40 executives from 27 U.S. based insurance organizations participated in the survey conducted during E&Y's recent seminar, "Insurance Accounting in the 21st Century" held in New York City.
Separately, the IASB issued its last hard copy interpretation, SIC-32: Intangible Assets – Web Site Costs, which coincidentally is likely to be the final interpretation to be named after the Standing Interpretations Committee (SIC). As of March 13, 2002, SIC was renamed the International Financial Reporting Interpretations Committee (IFRIC). SIC-32 became effective on March 25, 2002.
Commenting on SIC-32, IFRIC Chairman Kevin Stevenson said: "The Interpretation clarifies the existing requirements of IAS 38, Intangible Assets, as it applies to expenditure[s] on internally developing and operating a web site. If an enterprise applies the Interpretation and the outcome is to recognize the web site as an intangible asset, then unless the web site has an active market and its carrying amount is revalued regularly, the enterprise will need to amortize the expenditure over a short period."
SIC-32 represents the final distribution in hard copy of IFRIC documents as they are approved and issued. In the future, subscribers to IASB's Comprehensive Subscription Service will have access only to electronic versions of IFRIC documents, which can be downloaded immediately after their approval and issue.