IAS 39 — The meaning of 'commonly used currencies' in AG 33(d)

Date recorded:

The IFRIC discussed whether it should provide guidance on the operation of paragraph AG33(d)(iii) of IAS 39 Financial Instruments: Recognition and Measurement, which specifies whether foreign currency derivatives embedded in certain contracts (for example, contracts to buy or sell non-financial items) are closely related to the host contracts.

The IFRIC reached a tentative decision not to add this item to its agenda. IFRIC members thought that the issues relate to how to apply IAS 39 and that circumstances vary case-by-case. Judgement is necessary when determining whether the requirements in AG33(d)(iii) are satisfied based on the facts of each case. Any guidance that the IFRIC might be able to develop would be to add to the existing Application Guidance rather than an Interpretation of IAS 39. The staff was asked to adapt its analysis for inclusion in the tentative agenda decision.

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