4. presenting financial instruments

8/20/2019 4. Presenting Financial Instruments

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International Financial Reporting Standards

The views expressed in this presentation are those of the

presenter, not necessarily those of the IASB or IFRS Foundation.

© IFRS Foundation !" #annon Street $ondon %#&' ()* +. www.ifrs.org

IFRS - Financial

Instruments Disclosuresoint /orld Ban0 and IFRS Foundation 1train the

trainers2 wor0shop hosted 3y the %##B

!" April to & 'ay 4"54


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6 IFRS - sets out disclosures of financial instru7ents6 The presentation, recognition and 7easure7ent of

financial instru7ents are the su38ects of

6 IAS !4 Financial Instruments: Presentation

6 IAS !9 Financial Instruments: Recognition and

Measurement

6 IFRS 9 Financial Instruments :3eing developed in

phases; is intended to ulti7ately replace IAS !9.

4Introduction



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Infor7ation that ena3les users to evaluate thesignificance of financial instru7ents for the entity2s

financial position and financial perfor7ance.

6 Infor7ation :


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6 =ualitative infor7ation a3out exposure to ris0s arisingfro7 financial instru7ents.

6 The disclosures descri3e 7anage7ent2s o38ectives,

policies and processes for 7anaging those ris0s

&Disclosure requirements



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6 =uantitative infor7ation a3out exposure to ris0s arisingfro7 financial instru7ents, including specified 7ini7u7

disclosures a3out

6 credit ris0,

6 liDisclosure requirements continued



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• The IFRS for SMEs re


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6 =ualitative and


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6 Fair value infor7ation is re


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International Financial Reporting Standards

The views expressed in this presentation are those of the

presenter, not necessarily those of the IASB or IFRS Foundation

Offsetting

Financial Assets and

Financial Liabilities



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Disclosure requirements

6 Respond to co77ents?6 preparers? #ost3enefit C scope, class vs.

counterparty, existing disclosure re


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55

Grossamountsbefore

offsetting

(A)

Gross a7ountsset off

:B;

Det a7ountspresentedin 3alance

sheet:#;

Hther a7ountsin scope 3utnot set off in

3alance sheet:;

Net amounts

(E)

[same for all preparers]

[depends onoffsettingmodel

[depends onoffsetting model

[depends onoffsetting model

[same for all preparers]

Disclosure requirements continued

6 Eroposed disclosure?



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54

a. 3. c. d. e.

Financial assets Gross carring

amounts (before

offsetting)

Gross

a7ounts

offset

Net amount presented in

statement of financial

position

(a!b)

A7ounts availa3le to 3e offset :3ut

not set off in st7t of financial

position;

:ie in 3an0ruptcy or default;

Net e"posure

(c!d)

Categor Financial

instru7ents

#ash collateral

erivatives #$$ :"; %$ :5"; #$ !

Assu7e an entity has a recognised derivative asset with a fairvalue of 5"" and a recognised derivative lia3ility with a fair value

of " that 7eet the criteria for offsetting. The entity has another

derivative lia3ility with a fair value of 5" and cash collateral of 4"

that do not 7eet the criteria for offsetting.

The financial assets would 3e disclosed as follows?

E"ample&Disclosure



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5!

Sa7e exa7ple Assu7e an entity has a recognised derivativeasset with a fair value of 5"" and a recognised derivative lia3ility

with a fair value of " that 7eet the criteria for offsetting. The

entity has another derivative lia3ility with a fair value of 5" and

cash collateral of 4" that do not 7eet the criteria for offsetting.

The financial lia3ilities would 3e disclosed as follows?

E"ample&Disclosure continued

a. 3. c. d. e.

Financial

lia3ilities

Gross carring

amounts (before

offsetting)

Gross

a7ounts

offset

Net amount presented in

statement of financial

position

(a!b)

A7ounts availa3le to 3e offset :3ut

not set off in st7t of financial

position;

:ie in 3an0ruptcy or default;

Net e"posure

(c!d)

Categor Financial

instru7ents

#ash collateral

erivatives '$ :"; #$ #$ !



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Application guidance to IA %

•

#o77ents received highlighted inconsistencies in theapplication of the offsetting re


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5>

*uestions or comments+

E"pressions of indi,idual,ie-s b members of the

IA and its staff are

encouraged. /he ,ie-s

e"pressed in this

presentation are those of thepresenter.

0fficial positions of the IA

on accounting matters are

determined onl after

e"tensi,e due process and

deliberation.



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5(

The re

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