BCE.1 Before the IASB issues new requirements, or makes amendments to existing Standards, it considers the costs and benefits of the new pronouncements. This includes assessing the effects on the costs for both preparers and users of financial statements. The IASB also considers the comparative advantage that preparers have in developing information that would otherwise cost users of financial statements to develop. One of the main objectives of developing a single set of high quality global accounting Standards is to improve the allocation of capital. The IASB therefore takes into account the benefits of economic decision-making resulting from improved financial reporting. The IASB gains insight on the likely effects of the proposals for new or revised Standards through its formal exposure of proposals and through its analysis and consultations with relevant parties through outreach activities.

BCE.2 The IASB conducted extensive outreach activities with interested parties for each phase of IFRS 9. This included extensive discussions with regulators, users of financial statements, preparers and audit firms worldwide. In addition, as part of the Impairment project, the IASB formed the Expert Advisory Panel (EAP) to address some of the operational challenges of an expected cash flow approach and conducted fieldwork to assess the proposals of the 2013 Exposure Draft Financial Instruments: Expected Credit Losses (the ‘2013 Impairment Exposure Draft’). This Effects Analysis is based on the feedback received through this process.