EFRAG has published its draft comment letter in response to the IASB's Exposure Draft ED/2019/3 Reference to the Conceptual Framework (Proposed amendments to IFRS 3) and seeks constituents' views on the proposals. EFRAG’s letter supports the IASB proposals in its Exposure Draft.

On 30 May 2019 the IASB issued the Exposure Draft Reference to the Conceptual Framework (Proposed amendments to IFRS 3) (the ED). The ED proposes to:

  • Update IFRS 3 Business Combinations so it refers to the 2018 Conceptual Framework instead of the 1989 Framework.
  • Add to IFRS 3 an exception to its recognition principle. For liabilities and contingent liabilities that would be within the scope of IAS 37 Provisions, Contingent Liabilities and Contingent Assets or IFRIC 21 Levies if incurred separately, an acquirer should apply IAS 37 or IFRIC 21 respectively, instead of the Conceptual Framework, to identify the obligations it has assumed in a business combination.
  • Add to IFRS 3 an explicit statement that an acquirer should not recognise contingent assets acquired in a business combination.

Comments on EFRAG's draft comment letter are requested by 17 August 2019.