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The Commission has completed the endorsement process of IFRS 9 by the adoption of Commission Regulation (EU) No 1606/2016 of 22 November 2016.
IFRS 9 aims to improve the financial reporting of financial instruments by addressing concerns that arose in this area during the financial crisis. In particular, IFRS 9 responds to the G20’s call to move to a more forward-looking model for the recognition of expected losses on financial assets.
The new standard will come into effect on 1 January 2018 (with early application permitted) and will replace the currently applicable IAS 39 Financial Instruments: Recognition and Measurement.
To address the issue of the misalignment of the application dates of IFRS 9 and the forthcoming insurance contracts standard, IFRS 17, the Commission supports an optional deferral of IFRS 9 for the insurance industry for a limited period of time.
On 12 September 2016, the IASB issued amendments to the existing insurance contracts standard, IFRS 4, which will permit pure insurance companies to defer the application date of IFRS 9 from 2018 until 2021. The Commission welcomes the IASB work in this area. It has recently launched the endorsement process for this amendment to IFRS 4 with a request for advice sent out to EFRAG on 13 October 2016. As part of the endorsement process, the Commission will consider whether the IASB solution is satisfactory for the EU, in particular whether there is a need to extend the scope of the IASB's deferral to bancassurers.
The Official Journal of the EU