EFRAG: Study report on IFRS 9 Financial Instruments on classification and measurement of financial assets
05 November 2009
EFRAG is consulting on both, its assessment of IFRS 9 against the EU endorsement criteria and on its initial assessment of the costs and benefits that would arise from the implementation of IFRS 9 in the EU.
IFRS 9 Financial Instruments is the first phase of the IASB's replacement of “IAS 39 Financial Instruments: Recognition and Measurement”. IFRS 9 amends the classification and measurement requirements for financial assets. EFRAG has issued an Invitation to Comment relating to the endorsement for use in the EU of IFRS 9. It is consulting both on its assessment of IFRS 9 against the EU endorsement criteria and on its initial assessment of the costs and benefits that would arise from the implementation of IFRS 9 in the EU.
Comments are requested by 13 November 2009.
Background to the Standard
1 IFRS 9 has been developed in response to concerns that IAS 39 Financial Instruments: Recognition and Measurement (‘IAS 39’) is “difficult to understand, apply and interpret”. The financial crisis and pressures from G20 leaders and others to address financial reporting of financial instruments has led to the IASB and the FASB accelerating the timetable for the replacement of their standards on financial instruments. To ensure a timely response to calls to address concerns with IAS 39, the IASB has taken a phased approach to the development of the Standard. The first part of Phase 1 (that resulted in IFRS 9 as published by the IASB in November 2009) deals with classification and measurement of financial assets. The second part of Phase 1 will deal with classification and measurement of financial liabilities. Phase 2 will deal with impairment of financial assets carried at amortised cost (an exposure draft on this issue is expected to be issued in November 2009) and Phase 3 will address hedge accounting. The entire package is expected to be completed by the end of 2010. The IASB is also reconsidering requirements for derecognition of financial assets in a separate project with an intention to complete that project in 2010.
© EFRAG - European Financial Reporting Advisory Group
