IFRS 10 Special control approach

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IFRS 10 Special control approach determines which entities are consolidated in a parent’s financial statements and therefore affects a group’s reported results, cash flows and financial position – and the activities that are ‘on’ and ‘off’ the group’s balance sheet. Under IFRS, this control assessment is accounted for in accordance with IFRS 10 ‘Consolidated financial … Read more

The best 1 in overview – IFRS 9 Impairment requirements

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Under IFRS 9 Impairment requirements, recognition of impairment no longer depends on a reporting entity first identifying a credit loss event. IFRS 9 instead uses more forward-looking information to recognise expected credit losses for all debt-type financial assets that are not measured at fair value through profit or loss. IFRS 9 requires an entity to … Read more

Collateral and expected credit losses – 1 Simple Easy Example

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Topics hide Collateral and expected credit losses Example inclusion collateral in ECL Lease receivables Collateral and expected credit losses Collateral and expected credit losses In IFRS 9 collateral is a relevant factor in the measurement of expected credit losses. In IFRS 9 the estimate of expected cash shortfalls is reflected by the cash flows expected … Read more

IFRS 9 Appendix B Impairment Low credit risk

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Topics hide IFRS 9 Financial instruments IFRS 9 Appendix B Impairment Low credit risk Financial instruments that have low credit risk at the reporting date IFRS 9 Financial instruments IFRS 9 Appendix B Impairment Low credit risk Financial instruments that have low credit risk at the reporting date B5.5.22 The credit risk on a financial … Read more

Undue cost or effort

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Use back button from the brower The term ‘undue cost or effort’ is not defined in IFRS 9, although it is clear from the guidance that information available for financial reporting purposes is considered to be available without undue cost or effort. Entities are not required to undertake an exhaustive search for information, it does … Read more

30 days past due rebuttable presumption – simple and sufficient

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Past due status and more than 30 days past due rebuttable presumption – making loss provision calculations simple – The second simplification available in IFRS 9 sets out a rebuttable presumption that the credit risk on a financial asset has increased significantly since initial recognition when contractual payments are more than 30 days past due. … Read more

IFRS 9 Measurement

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Topics hide IFRS 9 Financial instruments IFRS 9 Measurement 5.1 Initial measurement 5.2. Subsequent measurement of financial assets 5.3 Subsequent measurement of financial liabilities 5.4 Amortised cost measurement Financial assets 5.5 Impairment Recognition of expected credit losses Determining significant increases in credit risk Modified financial assets Purchased or originated credit-impaired financial assets Simplified approach for … Read more

Classification and measurement model

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Use back button from the brower IFRS 9 prescribes a single classification and measurement model for financial assets, dependent on both: The entity’s business model objective for managing financial assets The contractual cash flow characteristics of financial assets. Financial instruments at amortised cost Debt instruments at fair value through other comprehensive income Financial instruments at … Read more

Basel Committee IFRS 9 Guidance

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Topics hide Basel Committee IFRS 9 Guidance Principles underlying the Banking IFRS 9 Guidance Application of the ECL requirements in the Banking IFRS 9 Guidance Key banking aspects of Banking IFRS 9 Guidance Proportionality, materiality and symmetry Reasonable and supportable information Consideration of forward looking information Grouping of exposures Credit risk grades at banks Assessment … Read more