IFRS 9

IFRS 9 specifies how an entity should classify and measure financial assets, financial liabilities, and some contracts to buy or sell non-financial items.

IFRS 9 requires an entity to recognize a financial asset or a financial liability in its statement of financial position when it becomes a party to the contractual provisions of the instrument. At initial recognition, an entity measures a financial asset or a financial liability at its fair value plus or minus, in the case of a financial asset or a financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or the financial liability.

What is the purpose of IFRS 9?


IFRS 9 is effective for annual periods beginning on or after 1 January 2018 with early application permitted. IFRS 9 specifies how an entity should classify and measure financial assets, financial liabilities, and some contracts to buy or sell non-financial items.

What are financial assets under IFRS 9?

Under IFRS 9, a financial asset is initially measured at fair value plus transaction costs, unless it is carried at fair value through profit or loss, in which case transaction costs are immediately expensed.

What is IFRS 9 in banking?

IFRS 9 is the International Accounting Standards Board’s (IASB) response to the financial crisis, aimed at improving the accounting and reporting of financial assets and liabilities. IFRS 9 replaces IAS 39 with a unified standard. … The classification and measurement of financial assets.

Is IFRS 9 still applicable?


IFRS 9 generally is effective for years beginning on or after January 1, 2018, with earlier adoption permitted. However, in late 2016 the IASB agreed to provide entities whose predominant activities are insurance-related the option of delaying implementation until 2021.

What is IFRS 9 in simple terms?


IFRS 9 is an International Financial Reporting Standard (IFRS) published by the International Accounting Standards Board (IASB). … It contains three main topics: classification and measurement of financial instruments, impairment of financial assets, and hedge accounting.

How does IFRS 9 work?

IFRS 9 contains an option to designate, at initial recognition, a financial asset as measured at FVTPL if doing so eliminates or significantly reduces an “accounting mismatch” that would otherwise arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases.