IFRS 9 FINANCIAL INSTRUMENTS

Why you need to work with BDO on IFRS 9 ‘Financial Instruments’

Failing to implement IFRS 9 adequately could lead to profit warnings, delays in lodging financial statements, qualified audit reports and even a loss of investor confidence and sharp falls in share price.

IFRS 9 may also change amounts reported in financial statements with knock on effects on bonuses or earn-outs linked to revenue or profit, finance charges where interest rate margins are linked to key ratios, and breaches of bank covenants.

Our expert team will carry out a robust and independent impact assessment of all the possible effects of IFRS 9 on your business. We want you to be confident that you are taking all the necessary steps and that your business is ready for IFRS 9.

We will also provide advice and guidance on any aspects of IFRS 9 that may be of particular concern or relevance to your business. Please get in touch to discuss how we can help.

IFRS 9 ‘Financial Instruments’ information and guidance

We have produced a comprehensive range of information and documents to help you understand and prepare for IFRS 9.

Overview of IFRS 9 ‘Financial Instruments’

IFRS 9 Financial Instruments introduces new requirements that will affect entities across all industry sectors, not just those in financial services. It is applicable for periods beginning on or after 1 January 2018, but earlier adoption is permitted. IFRS 9 replaces IAS 39.
 

IFRS 9 ‘Financial Instruments’ key features

• Introduction of new measurement requirements for financial instruments, with a different mixture of amortised cost and fair value
• A new forward looking expected loss impairment model, which requires consideration of macroeconomic data and forecasts of future events
• Changing requirements for hedge accounting to link better with risk management approaches.

IFRS 9 Documentation

The following guides and publications provide useful information and advice on IFRS 9 and its key features:

IFRS 9 At a glance

Applying-IFRS-9-to-Related-Company-Loans

Applying-IFRS-9-to-Related-Comp-Loans-Real-Estate-Sector

IFRS 9 Financial Instruments makes no distinction between unrelated third party and related party transactions. Entities that prepare stand-alone ἀnancial statements are required to apply the full provisions of the standard to all transactions within it scope. This means related company loan receivables must be classiἀed and measured in accordance with the requirements of IFRS 9, including where relevant, applying the Expected Credit Loss (ECL) model for impairment.

Applying-IFRS-9-to-Related-Company-Loans.pdf