Time Value of Money – it is just an IFRS sophistication of interest and discounting to present value.
The concept of time value of money is best explained in a simple way: a dollar today is worth more than a dollar in the future.
Imagine receiving $1,000 today and putting it in a simple bank savings account. That $1,000 will eventually grow over the years because the bank will pay interest on it. Thus, there is a greater benefit to getting the $1,000 now rather than later. If the amount is to be received later, it would be necessary to ask for more than $1,000 to compensate for the interest that could have been earned had the money been received today. https://en.wikipedia.org/wiki/Time_value_of_money
Timevalue of money in IFRS 9
The time value of money is the element of interest that provides consideration only for the passage of time and not for other risks and costs associated with holding the financial asset. [IFRS 9 B4.1.9A]
To assess whether an element provides consideration only for the passage of time, an entity uses judgement and considers relevant factors – e.g. the currency in which the financial asset is denominated and the period for which the interest rate is set.
Modified timevalue of money
IFRS 9 introduces the concept of ‘modified time value of money’, explaining that the time value of money may be modified – i.e. the relationship between the passage of time and the interest rate may be imperfect. It gives the following examples:
 if the asset’s interest rate is periodically reset but the frequency of that reset does not match the tenor of the interest rate – e.g. the interest rate resets every month to a oneyear rate; or
 if the asset’s interest rate is periodically reset to an average of particular shortterm and longterm rates. [IFRS 9 B4.1.9B]
An entity assesses the modified time value of money feature to determine whether it meets the SPPI test.
The objective of the assessment is to determine how different the undiscounted contractual cash flows could be from the undiscounted cash flows that would arise if the time value of money element was not modified (the benchmark cash flows). If the difference could be significant, the SPPI criterion is not met. The entity considers the effect of the modified time value of money element in each reporting period and cumulatively over the life of the financial instrument. [IFRS 9 B4.1.9CD]
In some cases, an entity may be able to make this determination by performing only a qualitative assessment. In other cases, it may be necessary to perform a quantitative assessment.
In making the assessment, an entity has to consider factors that could affect future contractual cash flows. For example, the relationship between the benchmark cash flows and the contractual cash flows could change over time. However, the entity only considers reasonably possible scenarios rather than every possible scenario. The reason for the interest rate being set in a particular way is irrelevant to the analysis.
IFRS 9 includes the following examples to illustrate the modified time value of money concept.
Examples: Modified time value of money
Interest rate resetting every month to a oneyear rate [IFRS 9 B4.1.9C]
Company X holds an asset with a variable interest rate that is reset every month to a oneyear rate.
To assess the modified time value of money feature, X compares the financial asset to a financial asset with identical contractual terms and identical credit risk – except that the variable interest rate is reset monthly to a onemonth rate.
If the modified time value of money element could result in undiscounted contractual cash flows that are significantly different from the undiscounted benchmark cash flows, the SPPI criterion is not met.
Constant maturity bond [IFRS 9 B4.1.9D, IFRS 9 B4.1.13]
Company Y holds a constantmaturity bond with a fiveyear term and a variable interest rate that is reset semiannually to a fiveyear rate. The interest rate curve at the time of initial recognition is such that the difference between a fiveyear rate and a semiannual rate is insignificant.
The benchmark instrument would be the one that resets semiannually to a semiannual interest rate. The fact that the difference between a fiveyear rate and a semiannual rate is insignificant at the time of initial recognition does not in itself enable Y to conclude that the modification of the time value of money results in contractual cash flows that are not significantly different from a benchmark instrument.
Y has to consider whether the relationship between the fiveyear interest rate and the semiannual interest rate could change over the life of the instrument such that the undiscounted contractual cash flows over the life of the instrument could be significantly different from the undiscounted benchmark cash flows.
Judgement needed in assessing modified time value of money [IFRS 9 BC4.178] 
The assessment of the modified time value of money element requires judgement to:

Review of contractual terms 
An entity will have to undertake a comprehensive review of its financial instruments at recognition – e.g. loan documentation – to identify contractual terms that modify the time value of money element. As part of the review, it may consider changing its business practices by amending ‘problematic contractual terms’ to enable this type of financial asset to be measured at amortised cost. 
Time Value of Money
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