Mineral Resources

An IASB exposure draft on exploration for and evaluation of mineral resources was published on 15 January. It proposes giving entities reporting under IFRS the option of accounting for their exploration and evaluation expenditure by using the accounting policies applied in their most recent annual financial statements. Under the proposals, exploration and evaluation assets are to be carried subject to impairment reviews as specified in IAS 36 Impairment of Assets but the cashgenerating unit used in the test may either that specified in IAS 36 or the one on which impairment tests were performed for the entity’s most recent annual financial statements. The disclosures proposed will identify and explain the amounts in the financial statements that arise from the exploration for and evaluation of mineral resources. The comment period ends on 16 April 2004.

International Interpretations

The International Finanical Reporting Interpretations Committee (IFRIC) has issued two draft interpretations: D3 Determining whether an Arrangement Contains a Lease; and D4 Decommissioning, Restoration and Environmental Rehabilitation Funds.

Both are available on the IASB website www.iasb.org.uk and, if finalised and adopted for use in Europe, will be mandatory in 2005 for accounts prepared under the IAS Regulation.

The comment period ends on 19 March 2004.

The UITF has considered both drafts and, whilst D3 will lead to accounting different from that in FRS 5, has no current plans for these Interpretations be added to UK standards.