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Initial Application of IFRS 17 and IFRS 9―Comparative Information (Amendments to IFRS 17) [Completed]

Effective date:

An entity that elects to apply the amendment applies it when it first applies IFRS 17

Last up­dated:

December 2021

Overview

The IASB developed a narrow-scope amendment to the transition requirements of IFRS 17, Insurance Contracts. The amendment is an option that is aimed at helping companies increase the usefulness of comparative information presented on initial application of IFRS 17 and IFRS 9, Financial Instruments.

The Board met on June 22, 2021 to discuss a proposed narrow-scope amendment to IFRS 17 to address one-time classification differences that may arise in the comparative information that insurance entities present on initial application of IFRS 17 and IFRS 9.

The Board tentatively decided to propose a narrow-scope amendment to IFRS 17. The amendment would permit an entity to apply a classification overlay in the comparative periods presented on initial application of IFRS 17 and IFRS 9. The optional classification overlay would:

  • apply to financial assets that are related to insurance contract liabilities and to which IFRS 9 has not been applied in the comparative periods;
  • allow an entity to classify these financial assets in the comparative periods based on a reasonable expectation of how these assets would be classified on initial application of IFRS 9;
  • apply to comparative periods that have been restated for IFRS 17 (that is, from the transition date to the date of initial application of IFRS 17); and
  • apply on an instrument-by-instrument basis.

The Board decided to set a comment period of 60 days for its Exposure Draft which was issued in July 2021.

In December 2021, the IASB issued Initial Application of IFRS 17 and IFRS 9—Comparative Information (Amendment to IFRS 17). The amendment is a transition option relating to comparative information about financial assets presented on initial application of IFRS 17. The amendment is aimed at helping entities to avoid temporary accounting mismatches between financial assets and insurance contract liabilities, and therefore improve the usefulness of comparative information for users of financial statements.

IFRS 17 incorporating the amendment is effective for annual reporting periods beginning on or after January 1, 2023.

 

Other De­vel­op­ments

December 2021

On December 9, 2021, the IASB published Initial Application of IFRS 17 and IFRS 9 — Comparative Information (Amendment to IFRS 17) with an amendment that enables companies to improve the usefulness of the comparative information presented on initial application of IFRS 17 and IFRS 9.

September 2021

On September 27, 2021, the IASB staff updated the Work Plan to indicate that the Board plans to review the Exposure Draft feedback in October 2021.

August 2021

On August 17, 2021, the AcSB issued its exposure draft that corresponds to the IASB’s Exposure Draft on this topic. Comments are requested by September 15, 2021.

July 2021

On July 28, 2021, the IASB has published the exposure draft Initial Application of IFRS 17 and IFRS 9 — Comparative Information (Proposed amendment to IFRS 17) that would enable companies to improve the usefulness of the comparative information presented on initial application of IFRS 17 and IFRS 9. The deadline for submitting comments is September 27, 2021.

June 2021

On June 22, 2021, the IASB added a project to its work plan to amend IFRS 17 to address one-time classification differences that may arise in the comparative information that insurance entities present on initial application of IFRS 17 and IFRS 9.

 

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