The simplified approach does not require an entity to track the changes in credit risk, but instead, requires the entity to recognize a loss allowance based on…… Read more “IFRS 9 – IMPAIRMENT – SIMPLIFIED APPROACH”

Some contracts (that may or may not be financial instruments themselves) may have derivatives embedded in them. For example, an entity may issue a bond which is…… Read more “IFRS 9 – EMBEDDED DERIVATIVES”

IFRS 9 requires equity investments (except those accounted under the equity method of accounting or those related to a consolidated investee), to be measured at FV. In limited circumstances, IFRS 9 permits an entity to…… Read more “IFRS 9 – MEASUREMENT OF UNQUOTED SHARES”

Under IFRS 9, one important condition for a financial asset to qualify for amortized cost classification is that the financial asset must meet the “SPPI” contractual cash…… Read more “IFRS 9 – The ‘SPPI’ test”

Under the previous standard (IAS 39), any movement in the fair value of financial liabilities designated at FVTPL, is always recognized in profit and loss. IFRS 9…… Read more “IFRS 9 – FINANCIAL LIABILITIES DESIGNATED AT FVTPL”

In this article we shall dive into one of the trickiest parts of the specific standard. The question to be addressed below is: how can we eliminate/reduce…… Read more “IFRS 9 – HOW TO REDUCE/ELIMINATE AN ACCOUNTING MISMATCH”

Financial guarantee contracts (FGCs) are a form of financial insurance and are governed by IFRS 9. The entity basically guarantees it will make a payment to another…… Read more “IFRS 9 – FINANCIAL GUARANTEE CONTRACTS”