IFRS 9 replaces most of the requirements of IAS 39 Financial Instruments: Recognition and Measurement with a principle-based and less complex standard. IFRS 9 changes the classification requirements for financial assets, using a single approach for all types of financial assets. Only basic lending instruments are potentially eligible for measurement at amortised cost and all other financial assets are measured at fair value. Measuring all non-basic lending instruments at fair value has led to the elimination of the multiple impairment models in IAS39 and the design of a single model based on the principle of expected, rather than incurred, credit losses results in earlier recognition of credit losses. The hedge accounting requirements more closely align hedge accounting with risk management practices.
IFRS 9 becomes effective for annual periods beginning on or after 1 January 2018, with earlier application permitted.
Comments are requested by 30 June 2015.
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