IFRIC 17 — Distributions of Non-cash Assets to Owners
- IAS 1 Presentation of Financial Statements (as revised in 2007)
- IAS 27 Consolidated and Separate Financial Statements
- IAS 37 Provisions, Contingent Liabilities and Contingent Assets
|17 January 2008||IFRIC D23 Distributions of Non-cash Assets to Owners published||Comment deadline 25 April 2008|
|27 November 2008||IFRIC 17 Distributions of Non-cash Assets to Owners issued||Effective for annual periods beginning on or after 1 July 2009|
Summary of IFRIC 17
IFRIC 17 Distributions of Non-cash Assets to Owners applies to the entity making the distribution, not to the recipient. It applies when non-cash assets are distributed to owners or when the owner is given a choice of taking cash in lieu of the non-cash assets.
IFRIC 17 clarifies that:
- a dividend payable should be recognised when the dividend is appropriately authorised and is no longer at the discretion of the entity
- an entity should measure the dividend payable at the fair value of the net assets to be distributed
- an entity should remeasure the liability at each reporting date and at settlement, with changes recognised directly in equity
- an entity should recognise the difference between the dividend paid and the carrying amount of the net assets distributed in profit or loss, and should disclose it separately
- an entity should provide additional disclosures if the net assets being held for distribution to owners meet the definition of a discontinued operation
IFRIC 17 applies to pro rata distributions of non-cash assets (all owners are treated equally) but does not apply to common control transactions.
Effective date and transition
- IFRIC 17 is to be applied prospectively.
- IFRIC 17 is effective for annual periods beginning on or after 1 July 2009. Earlier application is permitted, with some restrictions.
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IAS Plus Newsletter
Click for the IAS Plus Newsletter on IFRIC 17 (PDF 104k).