BC17 The Board considered a suggestion that the IFRS should not require a first‑time adopter to investigate transactions that occurred before the beginning of a ‘look back’ period of, say, three to five years before the date of transition to IFRSs. Some argued that this would be a practical way for a first‑time adopter to give a high level of transparency and comparability, without incurring the cost of investigating very old transactions. They noted two particular precedents for transitional provisions that have permitted an entity to omit some assets and liabilities from its balance sheet:

(a) A previous version of IAS 39 Financial Instruments: Recognition and Measurement [IFRS 9 Financial Instruments replaced IAS 39. IFRS 9 applies to all items that were previously within the scope of IAS 39.] prohibited restatement of securitisation, transfer or other derecognition transactions entered into before the beginning of the financial year in which it was initially applied.

(b) Some national accounting standards and IAS 17 Accounting for Leases (superseded in 1997 by IAS 17 Leases) permitted prospective application of a requirement for lessees to capitalise finance leases. Under this approach, a lessee would not be required to recognise finance lease obligations and the related leased assets for leases that began before a specified date.