Know Your Rights!!

IFRS 9 - Financial Instruments much awaited amendment is finally out on November 19, 2013. The entities which need to  deal with the financial instruments in line with IFRS, are probably aware of multiple standards covering this really titanic topic: IAS 39, IFRS 9, IFRS 7, IAS 32 and partially IFRS 13.  The new standard - IFRS 9 - is still under development. Let's see what are the 3 main changes brought in the amended IFRS 9: Mandatory effective date of IFRS 9 (1 January 2015) was removed. It means that you can apply old IAS 39 after 31-12-2014 Financial Liabilities (Own Debt) at Fair Value has new requirements for the accounting and presentation of changes in the fair value when own debt is measured at fair value New hedge accounting rules! New hedging rules were long-awaited, because the older rules in IAS 39 are really strict and hard to apply.  Further post will explain Hedge Accounting in brief..Stay glued:)

As a part of the disclosure requirements for fair value measurements, an entity should classify the financial instruments measured at fair value using a ‘fair value hierarchy’ that reflects the significance of the inputs used in making the measurements. IFRS 7 consist of fair value hierarchy in its required disclosures to increase the comparability and consistency. A new standard “Fair Value Measurements” by IASB is expected to come by April 2011 on the lines of Statement No. 157 or ASC 820 of the US GAAP as a part of joint project of FASB and IASB. As per existing IFRS 7, the fair value hierarchy has three different levels: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. A quoted price in an active market provides the most reliable evidence of fair value and should be used to measure fair value whenever available, except as follows: In some situ...