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IASB proposes narrow-scope amendments to IFRS 9, Financial Instruments

24 October 2022

The changes are proposed in response to stakeholder feedback. 

The IASB has proposed narrow-scope amendments to IFRS 9, Financial Instruments. The aim of the proposed amendments is to respond to stakeholders' feedback on the Request for Information published as part of the post-implementation review in September 2021.

The IASB met last week to discuss feedback on three aspects of its review of IFRS 9, relating to business model assessment, exploring possible narrow-scope amendments for electronic cash transfers, and equity instruments and other comprehensive income — with proposed amendments to IFRS 7, paragraph 11A.

The post-implementation review of the classification and measurement requirements in IFRS 9 discussed proposed amendments in three areas, according to the news release from the IFRS.

The proposed amendments are:

  1. Contractual cash flow characteristic: Clarification of the requirements to assess whether a financial asset's contractual cash flows are solely payments of principal and interest and new requirements to disclose information about the variability in contractual cash flows for financial assets and financial liabilities not measured at fair value through profit or loss.
  2. Electronic cash transfers: Proposed amendments to the derecognition requirements in IFRS 9 to permit an accounting policy choice to allow an entity to derecognise a financial liability before it delivers cash on the settlement date when specified criteria are met.
  3. Equity instruments and other comprehensive income: Proposed amendments to IFRS 7, Financial Instruments: Disclosures, would require disclosure of the aggregated fair value of equity investments for which the other comprehensive income presentation option is applied at the end of the reporting period; and changes in fair value recognised in other comprehensive income during the period.

[FM Magazine]