On May 27, 2026, the new standard IFRS 20 – Regulatory Assets and Regulatory Liabilities was officially issued, an update that will transform how entities subject to rate regulation reflect their financial performance.
Companies in sectors such as electricity, water, and gas must now recognize regulatory assets and liabilities arising from temporary differences between the provision of services and the time they are collected.
Why is it relevant?
Because IFRS 20 seeks to more accurately represent the economic reality of regulated companies, improving:
- Financial transparency * Comparability between entities
- Visibility of future cash flows * Quality of information for investors and stakeholders
In addition:
- It replaces IFRS 14 * It complements IFRS 15 * It will enter into force on January 1, 2029 * It will allow early adoption
Beyond an accounting change, this standard represents a strategic challenge for organizations, which must anticipate financial, operational, and reporting impacts.
Companies that start preparing now will have a clear advantage in the transition, and at Baker Tilly we want to help you—let's talk about the impact of IFRS 20 on your organization.
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