NAVIGATION

MEMBERS' HANDBOOK

Handbook Update No.308 contains the following update to Volume II of the Members’ Handbook:

(i) The following amendments, which were previously included in Section 1 and 2, are now incorporated into the text of the relevant Standards, Basis for Conclusions and Implementation Guidance in

Section 1.

International Tax Reform – Pillar Two Model Rules (Amendments to HKAS 12 Income Taxes)
Supplier Finance Arrangements (Amendments to HKAS 7 Statement of Cash Flows and HKFRS 7 Financial Instruments: Disclosures)

(ii) The following Hong Kong Financial Reporting Standards which have incorporated relevant amendments that are effective for annual reporting periods beginning on or after 1 January 2024, have been relocated from Section 2 to Section 1.

HKAS 1 Presentation of Financial Statements
HKFRS 16 Leases
HK Interpretation 5 (Revised) Presentation of Financial Statements – Classification by the Borrower of a Term Loan that Contains a Repayment on Demand Clause
HKFRS Practice Statement 2 Making Materiality Judgements

(iii) The title of Section 1 has been renamed to ‘Section 1: Effective for accounting periods beginning on or after 1 January 2024’.

(iv) Housekeeping changes have been made to the cover pages of certain Hong Kong Financial Reporting Standards in Section 1.

(v) Consequential amendments arising from Lack of Exchangeability (Amendments to HKAS 21 The Effects of Changes in Foreign Exchange Rates) have now been incorporated into the text of HKAS 21 and HKFRS 1 First-time Adoption of Hong Kong Financial Reporting Standards in Section 2. These amendments will be effective for annual reporting periods beginning on or after 1 January 2025.

The Institute’s Financial Reporting Standards Committee meeting minutes

Minutes of the February 2024 meeting is now available.

IASB issues narrow-scope amendments to classification and measurement requirements for financial instruments

The International Accounting Standards Board (IASB) has issued amendments to the classification and measurement requirements in International Financial Reporting Standard (IFRS) 9 Financial Instruments. The amendments respond to feedback from the 2022 Post-implementation Review of the Accounting Standard and clarify the requirements in areas where stakeholders have raised concerns, or where new issues have emerged since IFRS 9 was issued.

Webcast: Proposals in Exposure Draft Contracts for Renewable Electricity

In this webcast, the IASB staff discuss the IASB’s proposals to ensure that financial statements more faithfully reflect the effects of renewable electricity contracts on a company.

IASB May 2024 podcast & update

The IASB podcast, with its vice-chair, member and executive technical director highlighting the projects discussed during its May meeting, and a summary of the May meeting, are now available.

Keynote address from IASB Chair: ‘Let’s stay connected’

In his keynote address at the European Accounting Association Annual Congress on 15 May 2024, Andreas Barckow, Chair of the IASB, discussed the connectivity between financial statements and other reporting, including sustainability-related financial disclosures.

Tax planning and related services

The Institute has submitted its comment letter on the International Auditing and Assurance Standards Board (IAASB) Exposure Draft on Proposed International Standard on Auditing 240 (Revised), The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements.

The importance of audit documentation integrity

The article “The importance of audit documentation integrity” by the Accounting and Financial Reporting Council reminds auditors of the key standards relating to audit documentation integrity and emphasizes the importance of improving audit quality through the development of an effective system of audit documentation policies, procedures, and controls.

The Institute’s Auditing and Assurance Standards Committee meeting

Minutes of the 416th meeting are now available.

Tax planning and related services

The International Ethics Standards Board for Accountants (IESBA) released the ethics standards on tax planning and related services effective for tax planning activities or tax planning services beginning after 30 June 2025. These standards establish a comprehensive ethical framework to guide professional accountants when providing tax planning and related services. The framework stipulates the expected mindset and behaviours of professional accountants while recommending or advising on tax planning arrangements to employing organizations or clients.

To learn more about the standards, visit the IESBA’s designated webpage, which offers various resources, such as :

HKICPA resource centre

Access resources and publications at the Institute’s Resource Centre to the Code which will keep you updated on the latest ethics pronouncements

The Institute's Ethics Committee meeting

Minutes of the 262nd meeting are now available.

Invitation to comment

The Institute is seeking comments, by 24 June, on the International Federation of Accountants Exposure Draft Proposed Revisions to the International Education Standard (IES) 2, 3, and 4 – Sustainability and Proposed Revisions to IES 6 – Initial Professional Development – Assessment of Professional Competence that embed sustainability across aspiring professional accountants’ training. Take part to help shape future accountancy training.

Webcasts: Current and anticipated financial effects

The IFRS Foundation has published two new webcasts to help explain the requirements in the IFRS Sustainability Disclosure Standards related to the current and anticipated effects of sustainability-related risks and opportunities on a company’s financial position, financial performance and cash flows.

Jurisdictions representing over half the global economy by GDP take steps towards ISSB Standards

Jurisdictions representing over half the global economy by gross domestic product (GDP) have announced steps to use the International Sustainability Standards Board’s (ISSB) Standards or fully align their sustainability disclosure standards with those of the ISSB. To help jurisdictions in designing and planning their adoption or other use of ISSB Standards, the IFRS Foundation has released the publication Inaugural Jurisdictional Guide for the adoption or other use of ISSB Standards which shows how jurisdictions are progressing towards delivering globally consistent and comparable sustainability-related information.

GRI and IFRS Foundation collaboration to deliver full interoperability that enables seamless sustainability reporting

In response to market demand, the ISSB and the Global Sustainability Standards Board will collaborate to optimize how ISSB Standards and Global Reporting Initiative (GRI) can be used together. An initial outcome of this collaboration will involve a methodology pilot that builds on the recently published GRI 101 Biodiversity Standard and the ISSB’s upcoming project on Biodiversity, Ecosystems and Ecosystem Services.

ISSB May podcast & update

Featuring its chair and vice-chair, the ISSB podcast discusses the key takeaways from the May meeting and recent activities. In addition, a summary of the May meeting is now available.

Institute responses to SFC Consultation on proposals to enhance REIT regime and SFO market conduct regime for listed CIS

The Institute issued a submission in response to the Securities and Futures Commission (SFC)’s Consultation Paper seeking market feedback on a statutory scheme of arrangement and compulsory acquisition mechanism for real estate investment trusts (REITs) and an enhanced market conduct regime for listed collective investment schemes (CIS) under the Securities and Futures Ordinance (Cap. 571).

The Institute supports, in principle, the SFC’s proposals to provide a route for REITs to be subject to mergers and acquisitions and privatizations, and for undervalued REITs to be better able to realize their fair value, as in the case of listed companies. This should help to support the REIT market in Hong Kong.

Please refer to the submission for further details.

Professional Conduct and Duties of PIPs

The Official Receiver’s Office (ORO) has issued a letter for the attention of members who are private insolvency practitioners (PIPs). The Official Receiver would like to draw to PIPs’ attention to, in particular, the comments made by the Court in its two recent judgments concerning the conduct of PIPs, and to remind PIPs of the fundamental duties of full and frank disclosure in all insolvency proceedings.

Further details are contained in the letter, any questions on which should be addressed to Mr. Michael Cheung of the ORO at 2867 2515.

Electronic filing of 2023/24 individual tax returns – Convenience with eTAX

The Inland Revenue Department (IRD) encourages taxpayers to consider filing their tax returns through the IRD’s eTAX gateway to enjoy personalized online tax services. To save paper, taxpayers can also select to receive electronic notices and documents.

Announcements by the Inland Revenue Department

Members may wish to be aware of the following matters:

Announcements by the government

Members may wish to be aware of the following matters:

Anti-money laundering (AML) notices and news

AML notices:

The List of individuals and entities published under section 29 of the United Nations Sanctions (Somalia) Regulation 2019 (Cap.537CG) was updated on 22 May. See the relevant UNSC press release.
For the current lists of terrorists, terrorist associates and relevant persons/ entities under United Nations sanctions, members should refer regularly to the Institute's AML webpage. Other useful documents and guidance can also be found on the same page.

Other AML news:

Hong Kong Customs detects case of non-registered precious metals and stones dealer carrying out specified transactions

Publications from other organizations:

Why your company needs to rethink its purpose to acquire loyal customers – and drive more sales from Entrepreneur.com
Why fraud temptation arises and how to mitigate risks from Financial Management
CFOs play a critical role in getting diversity programs right from CFO.com
How AI can drive a proactive approach to corporate finance from Journal of Accountancy

Disclaimer: Some sections contain information from outside sources. We endeavour to link to reputable sources but the Institute is not responsible for the accuracy of the content and the content does not necessarily represent the views of the Institute.

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