14/09/2015 - EFRAG Endorsement Advice on IFRS 9 Financial Instruments
On 24 July 2014, the IASB published IFRS 9 Financial Instruments.
IFRS 9 replaces IAS 39 Financial Instruments: Recognition and Measurement and provides a principle-based approach to the recognition and measurement of financial instruments. IFRS 9 is effective for annual reporting periods beginning on or after 1 January 2018. Earlier application is permitted.
EFRAG has submitted its Endorsement Advice relating to IFRS 9 for use in the European Union and European Economic Area. EFRAG assesses that the Amendments meet all technical endorsement criteria of the IAS Regulation. In respect of its conclusion on the European public good, the endorsement advice concludes "that overall IFRS 9 is conducive to the European public good, except for the impact on the insurance industry of applying IFRS 9 before the finalisation of the forthcoming insurance contracts standard. The IASB is working on one or more solutions for the insurance industry and is expected to make tentative decisions in the next two months. We will advise you on our views as the IASB's work develops and on that basis will provide further advice relevant for the insurance industry. In any event we recommend that all businesses other than those carrying out insurance activities are required to account for their financial instruments in compliance with IFRS 9 in 2018 and businesses carrying out insurance activities are permitted to do so in compliance with IFRS 9 from the same date". EFRAG's recommendation is explained in the letter to the European Commission and the accompanying appendices.
The Endorsement Advice Letter to the European Commission can be found below.
