ESMA comment letter on tentative agenda decision on IFRS 9 and IAS 39 — Derecognition of financial assets

  • ESMA (European Securities and Markets Authority) (dark gray) Image

04 Feb, 2016

The European Securities and Markets Authority (ESMA) has commented on the IFRS Interpretations Committee's publication in the November IFRIC Update of the tentative decision not to take onto the Committee's agenda a potential narrow-scope project to clarify the circumstances in which a modification or exchange of financial assets results in derecognition of the original asset.

ESMA highlights that IAS 39 Financial Instruments: Recognition and Measurement and IFRS 9 Financial Instruments “do not provide sufficient guidance on accounting for the exchange or modification of financial assets” and is of the view that “more guidance is necessary in order to avoid diversity in accounting for this type of transactions, especially in relation to equity instruments”. 

ESMA therefor recommends that this project is added to the IASB’s active research agenda.

The full comment letter is available on the ESMA website.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.