EFRAG Secretariat issues a Briefing on Regulatory Assets and Regulatory Liabilities

In January 2021, the IASB issued the Exposure Draft ED/2021/1 Regulatory Assets and Regulatory Liabilities (the ED). The ED establishes accounting principles for recognition, measurement, presentation and disclosure of regulatory assets, regulatory liabilities, regulatory income and regulatory expense. The ED is intended to provide investors better information about the financial performance of companies subject to rate regulation.

EFRAG Secretariat has issued a Briefing on the ED to stimulate debate on the proposals in the ED. The Briefing includes EFRAG’s preliminary comments on scope of the proposed standard and EFRAG’s views on what constitutes a regulatory agreement and description of a regulator. The Briefing also provides an assessment of the outcome of the proposed standard when applied to different fact patterns.

Due to the nature of the Briefing, there are no questions included for the constituents. Constituents may express their views when responding to EFRAG’s draft comment letter.

The Briefing may be accessed here.