IASB Issues Amendment to IFRS 1 Regarding Government Loans

The IASB has issued Government Loans (Amendments to IFRS 1). This amendment addresses how a first-time adopter would account for a government loan with a below-market rate of interest when transitioning to IFRSs. It also adds an exception to the retrospective application of IFRS, which provides the same relief to first-time adopters granted to existing preparers of IFRS financial statements when the requirement was incorporated into IAS 20 in 2008. Entities are required to apply these amendments for annual periods beginning on or after 1 January 2013. Earlier application is permitted.