Last Updated on 21/03/2021 by 75385885
The term ‘undue cost or effort’ is not defined in IFRS 9, although it is clear from the guidance that information available for financial reporting purposes is considered to be available without undue cost or effort.
Entities are not required to undertake an exhaustive search for information, it does include, as examples of relevant information, data from risk management systems.
What is available without undue cost and effort would be an area subject to management judgement in assessing the costs and associated benefits.
Application of a requirement results in undue cost and effort if the cost or effort is excessive in comparison to the benefits that the users of the financial statements would receive from having the information. If the reporting entity is a bank, there would presumably be a higher hurdle to determine what credit risk information would require undue cost or effort, compared to a reporter that is not a bank, given that the benefit to users of its financial statements would be also expected to be higher.