Despite several amendments and clarifications issued earlier to amend the IAS 39, there was a growing need for a single and simplified comprehensive guidance on accounting for financial instruments.
In July 2014, the International Accounting Standards Board (IASB) had notified IFRS 9 to provide guidance on recognition and measurement principles for accounting of financial instruments. The new standard is intended to replace the existing standard, IAS 39, in its entirety from 1 January 2018 onwards, unless adopted early by a company.
IFRS 9 is expected to have an impact on the business as a whole, including IT & system environment, contractual arrangements, credit risk assessment, overall risk and governance, tax provisions, policies and procedure framework and of course on financial reporting.
This paper intends to discuss the key changes under IFRS 9 along with the potential implications for companies.