IFRS 9: Financial Instruments | KPMG | AE

IFRS 9: Financial Instruments

IFRS 9: Financial Instruments

In 2014, the IASB issued IFRS 9: Financial Instruments, which replaced IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 supersedes all previous standards and is mandatory for periods beginning on or after 1 January 2018. Early adoption permitted.


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  • Classification and measurement
IFRS 9 uses a logical, single classification and measurement approach for financial assets that reflects the business model in which they are managed and their cash flow characteristics.
  • Impairment

The forward-looking expected credit loss (ECL) model which result in more timely recognition of loan losses, is a single model that is applicable to all financial instruments subject to impairment accounting.

  • Hedge accounting

The standard also includes an improved hedge accounting model to better link the economics of risk management with its accounting treatment.

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