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Deloitte comment letter on IFRIC tentative agenda decision regarding IAS 39 and accounting for different aspects of restructuring Greek Government Bonds

Published on: Jul 18, 2012

Deloitte's IFRS Global Office has submitted a letter of comment responding to the IFRS Interpretation Committee's (IFRIC's) May 2012 'IFRIC Update' on the tentative decision not to include the request for guidance on application of the requirements of IAS 39 to the restructuring of Greek Government Bonds (GGBs) onto the IFRIC agenda.

In the comment letter, we agree with the IFRIC's decision not to add this item to its agenda. We also agree with the analysis set out in the tentative agenda decision, except for the following concerns:

  • [T]he draft wording that the assumption that "the part of the principal amount of the old GGBs that was exchanged for new GGBs could be separately assessed for derecognition [is] more favourable for achieving partial derecognition” could be misinterpreted. We would, therefore, suggest that the paragraph of the section on derecognition be amended to note that the submission recognised that, according to paragraph 16(a) of IAS 39, specifically identifiable or fully proportionate cash flows are a pre-requisite for partial recognition.
  • [W]e recommend that the Committee note in the agenda decision that, although the submitter requested an interpretation of IAS 39, the conclusions reached by the Committee would apply equally under IFRS 9 as the two Standards are equivalent in respect of the derecognition requirements considered by the Committee.
  • We . . . urge the Committee to request that the Board consider what is meant by a ‘non-financial variable specific to a party to the contract’ as part of the classification and measurement element of the IFRS 9 project.


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