The joint submission from CA ANZ and CPA Australia agrees that the thought process, rationale and conclusions are appropriate for the specific fact pattern set out in the Tentative Agenda Decision. But while the TAD appears to be right outcome based on the current requirements of IAS 37 Provisions, Contingent Liabilities and Contingent Assets (IAS 37) we note that IAS 37 was published more than 25 years ago, so may not adequately address climate-related risks.

We recommend the matters raised in the request are considered more broadly by the IASB in its Provisions—Targeted Improvements and Climate-related and Other Uncertainties in the Financial Statements projects. In particular, we recommend the IASB considers the following in those projects:

• Disclosure of a contingent liability in relation to a climate-related commitment. 
• Application guidance to assist with determining whether the facts of the entity’s commitment, and the circumstances surrounding it, meets the definition of a constructive obligation.
• Illustrative examples providing variations on the circumstances surrounding the entity’s commitment to clarify when it meets the definition of a constructive obligation.
• Measurement of a provision arising from a climate-related commitment.