Middle East accounting newsletter

Uncertain times | Financial reporting impact

The recent regional escalations have led to a high-risk environment across the Gulf. The situation is still very fluid, and scenarios can shift very quickly. This event continues to trigger uncertainty and cause market volatility, inflationary pressure, shifting customer demand and supply chain disruption. While the financial reporting impacts of this event are considered non-adjusting in nature for the year/period ended 31 December 2025, they will need to be taken into account in the financial statements for the year/period ended 31 March 2026.

In such times of heightened uncertainty, investors and regulators look for clarity in your financial reports. They want to know how your company is affected, how it is addressing the challenges, what judgements, estimates and assumptions you make, and how this is reflected in the financial statements.

You may use our Uncertain times hub and Be clear in times of uncertainty guide for help.

Illustrative annual and interim financial statements – 2026 guides

When preparing financial statements, our 2026 guides can help you to:

• report clearly in times of uncertainty;
• tell a connected story;
• focus on decision-useful information; and
• remember the bigger picture.

Our guides comprise illustrative disclosures and disclosure checklists, reflecting IFRS® Accounting Standards in issue at 20 March 2026. They are based on the requirements that apply for 2026 reporting periods, including those under IAS 1 Presentation of Financial Statements.

In addition, our Guide to annual financial statements – Illustrative disclosures for investment funds 2025 edition illustrates one possible format for financial statements based on a fictitious tax-exempt open-ended single-fund investment company. This edition reflects IFRS Accounting Standards in issue at 30 November 2025 that are required to be applied for annual periods beginning on 1 January 2025.

Also, look out for our future guides that will reflect the requirements of IFRS 18 Presentation and Disclosure in Financial Statements, which is effective from 1 January 2027.

Use our guides to help you prepare your annual and interim financial statements.

KPMG’s Insights into IFRS | 22nd Edition updated

KPMG’s Insights into IFRS ‒ your tool for applying IFRS Accounting Standards ‒ has been updated for new guidance on impairment testing of non-current assets and Pillar Two taxes.

How to get your copy of Insights

Insights into IFRS is available as an e-book on ProView^TM. Please speak to your usual KPMG contact to order your copy.

Risk mitigation accounting | Your essential guide to the proposals

A new accounting model proposed by the International Accounting Standards Board (IASB) could have significant impact for banks and insurers that manage repricing risk dynamically.
New presentation and disclosure requirements would also apply, including a new risk mitigation adjustment line item in the statement of financial position. The existing hedge accounting requirements under IAS 39 Financial Instruments: Recognition and Measurement would be withdrawn.

Read our detailed guide, which offers our insights and analysis on the proposed new model.

Accounting for tax incentives – Key questions answered

Tax incentives are often used by governments around the world to deliver on their public policies, particularly in times of heightened uncertainty.

Tax incentives may involve complex rules and raise challenging accounting questions.

Our new digital guide addresses common types of tax credits and answers key questions on:

• how to determine which accounting standard to apply; and
• what this means for the accounting and presentation in the financial statements.

IFRIC agenda decisions | IFRS 18 – five new agenda decisions

In its March meeting, the IFRS® Interpretations Committee voted to finalise new agenda decisions addressing IFRS 18 Presentation and Disclosure in Financial Statements. Several of these decisions are likely to mean changes in practice, so companies will need to keep a close eye on the outcomes as they prepare financial statements under the new standard.

In our latest video, part of a series on key discussions by the Committee, Brian O’Donovan summarises what was covered.

The IFRS Foundation also publishes updates of the Committee’s meetings.

Fair value option in IAS 28 | Have your say on the proposed amendments

A company is required to account for investments in associates and joint ventures under the equity method, unless it qualifies for the exemption in IAS 28 Investments in Associates and Joint Ventures to measure these investments at fair value through profit or loss (the fair value option).

The International Accounting Standards Board (IASB) is proposing narrow scope amendments to IAS 28. The proposals clarify the scope of the fair value option and would make it available to companies that have a main business activity of investing in particular types of assets (consistent with the concept of specified main business activities in IFRS 18 Presentation and Disclosure in Financial Statements).

A company would apply the proposed amendments when it applies IFRS 18 which is effective for annual periods beginning on or after 1 January 2027. There is an accelerated 60-day comment period ending on 20 April 2026.

Read our article to find out more. Take this opportunity to read and comment on the proposals.

ISSB to develop new requirements for nature-related reporting

Companies can expect further clarity on how to report on a broad spectrum of nature-related topics under IFRS® Sustainability Disclosure Standards.

In March 2026, the International Sustainability Standards Board (ISSB) decided to enhance IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information by adding incremental guidance on nature-related transition plans and targets, and by referring to SASB and other established standards for metrics.

The decisions aim to enhance interoperability with other standards, while recognising that market practice and investor needs around nature-related disclosures are still developing. The Nature-related Disclosures exposure draft is expected in October 2026. It will be followed by a period of public consultation and revision.

Read our article to find out more.

Proposals to update Scope 2 emissions guidance

Reporting on Scope 2 emissions could become more complex for companies under Greenhouse Gas Protocol (GHGP) proposals to update measurement methods. The proposals would require more granular measurement of both location-based and market-based emissions.

Our comments to the GHGP highlight concerns about the feasibility of the proposals and the decision-usefulness of the resulting information.

Consider how the proposed changes would affect your company. They could require you to change the types of instruments you are able to use, as well as how you measure emissions.

Materiality for sustainability reporting | New illustrative example supplement

To make the right decisions, your investors need the right information at the right time. So, when preparing reports under IFRS® Sustainability Disclosure Standards, you need to provide sustainability-related information that is clear, structured and decision-useful. However, you may face challenges in determining which information to report.

Our new supplement includes an example that illustrates how to apply our how-to guide to a specific scenario. Together, they can help you:

• navigate the complexities of sustainability reporting; and
• filter the relevant information to provide to your investors.

Read our how-to guide and our new illustrative example supplement, and bookmark our IFRS Sustainability hub for more news and guidance.

Land Sector and Removals Standard

Companies that present greenhouse gas (GHG) emissions in accordance with the GHG Protocol (GHGP) will need to change the way they account for land-based activities from 1 January 2027. Changes to accounting for removals are optional.

The GHGP’s new Land Sector and Removals Standard affects agricultural companies, as well as those with land sector activities in the value chain such as food or packaging. Companies involved with removals may have no connection to the land sector.

The standard builds on the GHG Protocol Corporate Accounting and Reporting Standard and the GHG Protocol Value Chain (Scope 3) Accounting and Reporting Standard and now forms part of the GHGP Corporate Suite of Standards.

Read our article to find out more.

Enhancing the SASB Standards | Further proposals to improve industry-based disclosures

Many companies use SASB Standards to provide decision-useful information to investors. These industry-based standards are set to change.

The International Sustainability Standards Board (ISSB) has launched a consultation on proposed amendments to three industry standards, affecting agricultural products; meat, poultry and dairy; and electric utilities and power generators.

Read our article to find out more.

Take this opportunity to have your say by 24 July 2026.