IAS 1 — Classification of debt with covenants as current or non-current



In January 2020, the Board issued Classification of Liabilities as Current or Non-current, which amended IAS 1 Presentation of Financial Statements. The amendments clarified how an entity classifies debt and other financial liabilities as current or non-current in particular circumstances. The amendments are effective for annual reporting periods beginning on or after 1 January 2023, with earlier application permitted.

In December 2020, the IFRS Interpretations Committee published a tentative agenda decision in response to informal feedback and enquiries about how an entity applies the amendments to particular fact patterns. After considering feedback to its tentative agenda decision, the Committee handed the matter over to the IASB as that feedback provided information about situations the Board did not specifically consider when developing the 2020 amendments.

In response to that new information, the Board tentatively decided to amend IAS 1 with respect to classification (as current or non-current), presentation and disclosures of liabilities for which an entity’s right to defer settlement for at least 12 months is subject to the entity complying with conditions after the reporting period.


Current status of the project

The IASB first discussed this issue in June 2021. An exposure draft of proposed amendments was published on 19 November 2021 with a comment letter deadline of 21 March 2022.


Project milestones

Date Development Comments
June 2021 Issue first discussed by the IASB
19 November 2021 ED/2021/9 Non-current Liabilities with Covenants (Proposed amendments to IAS 1) published Comments requested by 21 March 2022


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