The IASB issued IFRS 9 on 12 November 2009 as the first step in its project to replace IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 introduces new requirements for classifying and measuring financial assets. Those requirements must be applied starting 1 January 2013, with earlier adoption permitted including for 2009. The IASB intends to expand IFRS 9 during 2010 to add new requirements for classifying and measuring financial liabilities, derecognition of financial instruments, impairment, and hedge accounting. By the end of 2010, IFRS 9 will be a complete replacement for IAS 39 – mandatory for 2013 and optional in earlier years. This newsletter explains the requirements of IFRS 9 in detail, compares IFRS 9 and IAS 39, and analyses the potential impact of a move to the new standard.

The headlines (from the IAS Plus Update Newsletter)

New classification and measurement requirements for financial assets New criteria for amortised cost measurement New measurement category – fair value through other comprehensive income Impairment assessment only for amortised cost assets     No more available-for-sale assets No more held-to-maturity assets and tainting rules No more embedded derivatives in financial assets No more unquoted equity investments measured at cost less impairment