Significant progress was made at the IASB’s May meeting.
The Board discussed the future direction of its projects on macro hedge accounting and financial instruments with characteristics of equity.
“The IASB has made welcome progress in outlining plans to move forward its two ongoing financial instruments projects. However, the complexity of the topics means that there is a lot of work to do.”
For more detail on these discussions, read Issue 23 of our IFRS Newsletter: Financial Instruments.
The next step for the macro hedging project will be to identify the information needs of constituents, before considering recognition and measurement requirements.
The Board tentatively decided to prioritise dynamic interest rate risk management, and expects to set up an ‘expert advisory panel’ at a later stage.
For its project on financial instruments with characteristics of equity, the IASB plans first to identify the characteristics of claims that create challenges in distinguishing between liabilities and equity.
The project would then explore the possible solutions, which may involve amending IAS 32 Financial Instruments: Presentation, or the definitions of a liability or equity.
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