1 The IASB has proposed changes to the old and new financial instruments Standards, IAS 9 and IFRS 39, in light of the reform of interest rate benchmarks such as interbank offer rates The Board has proposed to amend IFRS 9 Financial Instruments and IAS 39 Financial Instruments: Recognition and Measurement to provide relief from specific hedge accounting requirements that could have resulted in the discontinuation of hedge accounting solely due to the uncertainty arising from interest rate benchmark reform. IFRS Standards require companies to use forward-looking information to apply hedge accounting. While interest rate benchmark reform is ongoing, uncertainty exists about when the current interest rate benchmarks will be replaced and with what interest rate. Without the proposed amendments, this uncertainty could result in a company having to discontinue hedge accounting solely because of the reform’s effect on its ability to make forward- looking assessments. This, in turn, could result in reduced usefulness of the information in the financial statements (FS) for investors. The Board is considering the accounting implications arising from the reform in 2 stages. These proposed amendments relate to the effects of uncertainty in the period leading up to the replacement of interest rate benchmarks. As more information becomes available about the replacements, the Board will assess the potential accounting implications of reform and determine whether to take further action. Read more Ind AS July 2019
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July 2019 Ind AS · 3 The IASB has published proposed narrow-scope amendments to IFRS 3 Business Combinations.The amendments would update a reference to the Conceptual Framework for
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Transcript
1
The IASB has proposed
changes to the old and
new financial
instruments Standards,
IAS 9 and IFRS 39, in
light of the reform of
interest rate
benchmarks such as
interbank offer rates
The Board has proposed to amend IFRS 9 Financial Instruments and IAS 39 Financial
Instruments: Recognition and Measurement to provide relief from specific hedge accounting
requirements that could have resulted in the discontinuation of hedge accounting solely due
to the uncertainty arising from interest rate benchmark reform.
IFRS Standards require companies to use forward-looking information to apply hedge
accounting. While interest rate benchmark reform is ongoing, uncertainty exists about when
the current interest rate benchmarks will be replaced and with what interest rate. Without
the proposed amendments, this uncertainty could result in a company having to discontinue
hedge accounting solely because of the reform’s effect on its ability to make forward-
looking assessments. This, in turn, could result in reduced usefulness of the information in
the financial statements (FS) for investors.
The Board is considering the accounting implications arising from the reform in 2 stages.
These proposed amendments relate to the effects of uncertainty in the period leading up to
the replacement of interest rate benchmarks. As more information becomes available about
the replacements, the Board will assess the potential accounting implications of reform and
The proposals in Exposure Draft pertaining to proposed
amendments to IFRS 9 and IAS 39 will affect entities that apply the
hedge accounting requirements of IFRS 9 or IAS 39 to hedges of
interest rate risk affected by interest rate benchmark reform, and
those who use their financial statements.
The IASB has proposed 3 amendments to IFRS 3- (i)to remove from
IFRS 3 a reference to an old version of the Board’s Conceptual
Framework, (ii) to add to IFRS 3 an exception to its recognition
principle and (iii) to make the IFRS 3 requirements for contingent
assets more explicit
The amendments to IFRS 17 aim to ease implementation of the
Standard by reducing implementation costs and making it easier for
companies to explain the results of applying IFRS 17 to investors and
others.
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