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Financial instruments — Impairment (inactive)

This project is one aspect of the comprehensive Financial Instruments project, which is a joint project with the IASB. 

The impairment project began in 2008 with the IASB and FASB developing and ultimately issuing separate impairment models in 2009 and 2010, respectively. The IASB model was an expected cash flow approach that resulted in an effective interest rate that integrated credit loss expectations. The FASB model eliminated the “probable threshold” for impairment recognition in current U.S. GAAP. The FASB model was based on the recognition of full lifetime expected losses upon acquisition or origination of the financial asset.

The FASB participated with the IASB in an Expert Advisory Panel (EAP) that advised the boards on the operational issues surrounding the IASB’s expected cash flow approach and the FASB’s approach for determining credit impairments. The document below provides a summary of the discussions of the EAP on the pertinent aspects of the proposed FASB credit impairment model to inform the FASB and its constituents. This paper does not contain the detailed minutes of the EAP or its final recommendations to the boards.

Meeting minutes

Deloitte Observer meeting notes on the impairment project are available on the Global IAS Plus Web site.


Current status

On July 24, 2014, the IASB published the finalized version of IFRS 9, Financial Instruments, which incorporates limited amendments to the classification and measurement requirements for financial assets (as well as a new expected loss impairment model). The FASB will continue deliberating this project as a FASB-only project.


Project milestones

June 18, 2009 Request for Information on expected loss model published. Comment deadline September 1, 2009
November 5, 2009 Exposure Draft ED/2009/12, Financial Instruments: Amortised Cost and Impairment, issued by the IASB. Comment deadline June 30, 2010.
November 2009 Expert Advisory Panel formed.
May 26, 2010 Proposed Accounting Standards Update (ASU), Accounting for Financial Instruments and Revisions to the Accounting for Derivative Instruments and Hedging Activities — Financial Instruments (Topic 825) and Derivatives and Hedging (Topic 815), issued by the FASB. Comment deadline September 30, 2010.
January 31, 2011 Supplement Document, Accounting for Financial Instruments and Revisions to the Accounting for Derivative Instruments and Hedging Activities — Impairment, by the FASB and IASB. Comment deadline April 1, 2011.
December 20, 2012 Proposed ASU, Financial Instruments — Credit Losses, issued by the FASB. Comment deadline May 31, 2013.
March 7, 2013 Exposure Draft ED/2013/3, Financial Instruments: Expected Credit Losses, issued by the IASB. Comment deadline July 5, 2013.
July 24, 2014 IFRS 9, Financial Instruments, is issued by the IASB. Effective for reporting periods beginning on or after January 1, 2018.

Correction list for hyphenation

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