The Board discussed an analysis of the results of a survey of the views of users responsible for making investment and credit decisions (or those advising others on investment and credit decisions), which asked what types of information in respect of financial instruments measured at fair value would be relevant to their analysis.

The staff had received responses to the questionnaire from 47 individuals covering 34 organisations, including many of the major sell-side and buy-side institutions. Six of the organisations who participated are based in the US with the rest based outside the US. The staff thanked these constituents for their assistance. Board Members noted that the survey was one of the most comprehensive and useful of its kind.

The questionnaire raised the following major points:

• Users require some disaggregated information for financial instruments that are measured at fair value. In particular, users continue to want information on bad debts (both in terms of bad debt charges and bad debt allowances) and interest. However, most users do not believe that further disaggregation of fair value changes and balances would provide information that would be of significant value given the current valuation methods that are used;
• There is little or no demand for interest income/expense to be reported on a 'fair value' basis. Most users express a preference for interest information to be presented on an accruals basis;
• There is support for the provision of more information on the exposure of an entity to future changes in the fair value of financial instruments (such as enhanced sensitivity analysis or stress tests)

It was noted that users had a general level of unease with the degree of optionality within IAS 39 and had difficulty tracking the reversal of value changes recognised in equity when these were subsequently recycled to profit and loss. In addition, it was noted that the survey was conducted before the effective date of IFRS 7, which requires some of the information currently sought by users.

The Board agreed that the next steps in the project should be to hold further discussions with selected users to:

• Ensure that the staff analysis as set out in this paper is appropriate; and
• Attempt to develop requirements for sensitivity analysis/stress tests that will provide useful information to users.