Disclosures by class of financial instruments

IFRS 7 25 requires the disclosure of the fair value of financial assets and financial liabilities by class in a way that permits it to be compared with its carrying amount for each class of financial asset and financial liability.

An entity should disclose for each class of financial instrument the methods and, when valuation techniques are used, the assumptions applied in determining fair values of each class of financial asset or financial liability.

Financial instruments at amortised costRead more

Where to disclose financial instruments?

This about the location, level of disclosure and aggregation of financial instruments.

An entity is permitted to disclose some of the information required by the financial instruments standards (IAS 32, IAS 39, IFRS 7 and IFRS 9). [IFRS 7 8, IFRS 7 20]

Some entities may want to present some of the information required by IFRS 7, such as the nature and extent of risks arising from financial instruments and the entity’s approach to managing those risks, alongside the financial statements in a separate management commentary or business review.

This is only permissible for disclosures requires by IFRS 7 32 – 41 (that is, nature and risk arising from financial instruments) where the information is incorporated … Read more

Disclosure financial instruments

IFRS 7 requires certain disclosures to be presented by category of an instrument based on the IFRS 9 recognition and measurement categories of financial instruments (previously the IAS 39 measurement categories). Certain other disclosures are required by class of financial instrument. For those disclosures an entity must group its financial instruments into classes of similar instruments as appropriate to the nature of the information presented. [IFRS 7 6]

The two main categories of disclosures required by IFRS 7 are:

  1. information about the significance of financial instruments [IFRS 7 7 – 30]
  2. information about the nature and extent of risks arising from financial instruments [IFRS 7 31 – 42]

So IFRS 7 bets on … Read more

Management of credit risk for financial instruments

Financial institutions (banks, insurance companies, investment entities) should have a management process in place to identify, measure, monitor and control credit risk as well as to determine that they hold adequate capital against these risks and that they are adequately compensated for risks incurred.

The sound practices should specifically address the following areas:

  1. establishing an appropriate credit risk environment;
  2. operating under a sound credit-granting process;
  3. maintaining an appropriate credit administration, measurement, and monitoring process; and
  4. ensuring adequate controls over credit risk.

Although specific credit risk management practices may differ among financial institutions depending upon the nature and complexity of their credit activities, a comprehensive credit risk management program will address these four areas. These practices should also be applied Read more

Presentation and disclosure of crypto-assets

The disclosure by holders of crypto-assets will be driven by the disclosure requirements of the IFRS standards that are applied in accounting for them. This narrative illustrates selected disclosure requirements for each classification and measurement in more detail, as well as the general IAS 1 requirements that could be relevant to the holder of crypto-assets.

Holders of crypto-assets need to consider materiality when determining what disclosures are required in their specific circumstances, as well as when to aggregate amounts on the face of the financial statements and in the notes. An entity should not obscure material information with immaterial information or aggregate material items that have different natures or functions as these will reduce the understandability of the financial … Read more

IFRS 7 Disclosures for IFRS 9 Financial instruments

This is a high level summary of the disclosure requirements added to IFRS 7 Financial Instruments: Disclosures that accompanies the impairment model in IFRS 9 Financial Instruments.

Credit risk management practices

An entity is required to disclose:… Read more