Financial instruments – Relevant features of claims

Financial instruments – Relevant features of claims

This IFRS newsletter reports on the IASB’s June 2015 discussions on financial instruments.

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We report on the IASB’s latest discussions its project on financial instruments with characteristics of equity.

More progress has been made on the IASB’s project on financial instruments with characteristics of equity.

After the project restarted in earnest last month, the Board has begun identifying the features of claims that are relevant to distinguishing between liabilities and equity.

 

“The project has made progress by identifying the relevant features in measuring claims. The next challenge is to explore how these features affect users’ information needs.”

 

For more detail on these discussions, read Issue 24 of our IFRS Newsletter: Financial Instruments.

Financial instruments with characteristics of equity

As a first step, at its June meeting the Board discussed the features that are relevant in measuring the claims – namely, the:

  • type of economic resource required to settle the claim;
  • timing of the transfer of economic resources required to settle the claim;
  • amount or quantity of economic resources required to settle the claim;
  • priority of the claim relative to other claims; and
  • conditions or contingencies attached to the claim.

Next steps for the project

The next step will be to analyse the relevance of the identified features for assessments that users might make using different parts of financial statements.

Find out more

Visit our IFRS Newsletters web page for the latest discussions on these issues, as well as the macro hedge accounting project.

And go to our IFRS – Financial instruments hot topics page for more on these and other aspects of financial instruments accounting under IFRS.

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