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The IASB has amended its new and old financial instruments Standards, IFRS 9 Financial Instruments and IAS 39 Financial Instruments: Recognition and Measurement, as well as the related Standard on disclosures, IFRS 7 Financial Instruments: Disclosures.
The amendments modify some specific hedge accounting requirements to provide relief from potential effects of the uncertainty caused by the IBOR reform. In addition, the amendments require companies to provide additional information to investors about their hedging relationships which are directly affected by these uncertainties.
Hans Hoogervorst, Chair of the IASB, said:
The Board has worked to an accelerated timetable to give companies a solution to the accounting challenges they face from the uncertainty surrounding the reform of interest- rate benchmarks. The amendments provide useful information for investors during this period of uncertainty.
The IASB followed a phased response to the reform of interest-rate benchmarks. Phase 1 culminates with the amendments issued today and focuses on the accounting effects of uncertainty in the period leading up to the reform. The IASB has started work on Phase 2, which considers the potential consequences on financial reporting of replacing an existing benchmark with an alternative.
Full press release on the IASB