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EFRAG field-test results on proposals to IFRS 9

  • EFRAG (European Financial Reporting Advisory Group) (dk green) Image

17 Jun 2013

The European Financial Reporting Group (EFRAG) has issued a report containing the results of the field test conducted by the EFRAG and National Standard Setters (NSS) ANC, ASCG, FRC and the OIC, on how the new requirements in IFRS 9, as amended by Exposure Draft (ED) ‘Classification and Measurement: Limited Amendments to IFRS 9’, would affect the current classification and measurement of financial assets.

The focus of the field test was to (1) identify when the application of the new classification and measurement requirements in IFRS 9 would lead to changes in the current measurement of financial assets under IAS 39 and (2) gather facts and objective data from participants rather than views and opinions.

In general, the results of the field test indicated that:

More financial assets would be measured at FV-PL under IFRS 9 because they fail the contractual cash flow characteristics assessment.

Bifurcation of financial assets is currently used only to a limited extent.

Investment strategies and/or the level at which the business model test is performed could change when implementing IFRS 9 to achieve a particular accounting measurement.

The field-test results will be used as input to the European Commission’s endorsement process. Additionally, the EFRAG and NSS will use the feedback received to develop their views on the impacts of the proposals.

More information on the results of the field test are available on the EFRAG website.

 

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