IAS 21 — Lack of exchangeability



The IFRS Interpretations Committee received a submission about the determination of the exchange rate when there is a long-term lack of exchangeability as IAS 21 The Effects of Changes in Foreign Exchange Rates does not include explicit requirements on the exchange rate an entity uses when the spot exchange rate is not observable. The Committee researched possible narrow-scope standard-setting and concluded that the best way forward was to recommend that the IASB propose narrow-scope amendments to IAS 21 to address the matter.

In November 2019, the IASB took the matter over and during its subsequent meetings discussed how to assess whether a currency is exchangeable and which exchange rate to use when it is not. The Board decided to propose to add requirements to IAS 21 that will help an entity determine whether a currency is exchangeable into another currency and requirements the entity would apply when it is not.


Current status of the project

This project has been completed. The IASB issued Lack of Exchangeability (Amendments to IAS 21) on 15 August 2023.


Project milestones

Date Development Comments
November 2019 Issue first discussed by the IASB
20 April 2021 ED/2021/4 Lack of Exchangeability (Proposed amendments to IAS 21) published Comments requested by 1 September 2021
15 August 2023 Lack of Exchangeability (Amendments to IAS 21) issued An entity applies the amendments for annual reporting periods beginning on or after 1 January 2025


Correction list for hyphenation

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