INT FRS 106 Liabilities arising from Participating in a Specific
Market – Waste Electrical and Electronic Equipment
This Interpretation clarifies when certain producers of electrical
goods are required to recognise a liability under FRS 37 Provisions,
Contingent Liabilities and Contingent Assets for the cost of waste
management relating to the decommissioning of waste electrical
and electronic equipment supplied to private households.
It was concluded that the event giving rise to the liability for costs
of such waste is participation in the market in the period in which
the original seller’s market share is determined for the purposes
of allocating ultimate waste management costs (measurement
period). It is this date, rather than the date of production of the
equipment or incurrence of costs, that is the triggering event for
liability recognition.
INT FRS 107 Applying the Restatement Approach under FRS
29 Financial Reporting in Hyperinflationary Economies
The main requirements of the Interpretation are:
• In the period in which the economy of an entity’s functional
currency becomes hyperinflationary, the entity shall apply the
requirements of FRS 29 as though the economy had always
been hyperinflationary. The effect of this requirement is that
restatements of non-monetary items carried at historical cost
are made from the dates at which those items were first
recognised; for other non-monetary items (not carried at
historical cost) the restatements are made from the dates at
which revised current values for those items were established.
FRS 21.16 clarifies that non-monetary items are characterised
by the absence of a right to receive (or an obligation to deliver)
a fixed or determinable number of units of currency. Examples
include: amounts prepaid for goods and services (e.g., prepaid
rent); goodwill; intangible assets; inventories; property, plant
and equipment; and provisions that are to be settled by delivery
of a non-monetary asset.
• Deferred tax amounts in the opening balance sheet are
determined in two stages:
o Deferred tax items are remeasured in accordance with
FRS 12 after restating the nominal carrying amounts of
the non-monetary items in the opening balance sheet by
applying the measuring unit at that date.
o The deferred tax items remeasured in this way are restated
for the change in the measuring unit from the date of the
opening balance sheet to the date of the closing balance
sheet.