IASB Releases IFRS 9-Financial Instruments (Completes 1st Phase of Project: Classification & Measurement)

Earlier today, the IASB released IFRS 9, Financial Instruments. As noted in IASB's press release, IASB is engaged in a three-phase project to replace its existing standard, IAS 39, Financial Instruments, Recognition and Measurement, with a new standard, IFRS 9, Financial Instruments. The three phases and related due process documents are listed below.

1. Final standard, IFRS 9, Financial Instruments, issued today represents completion of the first phase of the project, focusing on Classification and Measurement of Financial Instruments. The press release notes: "The new standard enhances the ability of investors and other users of financial information to understand the accounting of financial assets and reduces complexity – an objective endorsed by the Group of 20 leaders (G20) and other stakeholders internationally. IFRS 9 uses a single approach to determine whether a financial asset is measured at amortised cost or fair value, replacing the many different rules in IAS 39. The approach in IFRS 9 is based on how an entity manages its financial instruments (its business model) and the contractual cash flow characteristics of the financial assets. The new standard also requires a single impairment method to be used, replacing the many different impairment methods in IAS 39. Thus IFRS 9 improves comparability and makes financial statements easier to understand for investors and other users. Regarding liabilities, the press release notes: "the IASB decided not to finalise requirements for financial liabilities in IFRS 9 [and] expects to issue final requirements [regarding financial liabilities] during 2010."
2. Exposure Draft issued last week on the second phase of the project: Financial Instruments: Amortized Cost and Impairment. The comment deadline on the Exposure Draft is June 30, 2010.
3. Upcoming proposals on Financial Instruments: Hedge Accounting continue to be developed.

Archived IASB Webcast on IFRS 9
A live webcast was convened by the IASB at two separate times earlier today (11am GMT and 2pm GMT) at which questions were taken from the audience. Opening each webcast, IASB Communications Advisor Sonja Horn noted that over 1,000 people were registered for each webcast. Horn introduced Gavin Francis, Director, Capital Markets, IASB and Sue Horn, Senior Technical Consultant, IASB who walked listeners through a slide deck summarizing IFRS 9 and responded to questions from the audience. The archived webcasts have already been posted on the IASB website; (the a.m. webcast begins at approx. 16 minutes into the tape, and the p.m. webcast begins at approx. 17 minutes into the tape). Each webcast lasts approximately 45 minutes (including the Q&A) and the slides summarizing IFRS 9 can be downloaded from the webcast link. Additional information about IFRS 9 can be found on the IASB's Financial Instruments Project Page

FASB Financial Instruments Proposals Expected 1Q2010
As noted in the IASB-FASB joint statement issued on Nov. 5 reaffirming the boards' commitment to convergence by June, 2011, the discussion of progress by IASB and FASB on their respective financial instruments projects notes: "FASB has been developing proposals to replace the equivalent requirements in US GAAP, which it plans to publish for public comment in the first quarter of 2010." The joint statement details how the boards plan to address convergence issues, given that the IASB's three phase approach vs. FASB's unified approach to addressing the financial instruments project.

Learn More
Learn more about current FASB, IASB and SEC developments at FEI's 28th Annual Current Financial Reporting Issues (CFRI) conference taking place on Mon. Nov. 16-Tues. Nov. 17 at the New York Marriott Marquis in NYC. We strongly encourage you to register in advance, but on-site registration is also available. Featured speakers include FASB Chairman Robert Herz, IASB Board Member Patrick Finnegan, SEC Commissioner Kathleen Casey, SEC Chief Accountant Jim Kroeker, SEC Div. of Corp Fin Chief Accountant Wayne Carnall, and other experts.

Separately, FEI's Hall of Fame (sold out) will take place Monday evening, Nov. 16 in NYC, honoring this year's inductees to the Hall of Fame: Dennis Dammerman and Don Nicolaisen.

Also next week: FEI's IFRS Boot Camp, Wed. Nov. 18 in NYC, sponsored by Deloitte. Sign up for this one-day workshop, designed to provide financial executives with practical information, cost-effective approaches, and an overview of time-saving tools for addressing IFRS assessments and conversions in their organizations

If you're betting on a transition to IFRS, consider signing up for the 2-day IFRS Conference Dec. 2-3 in Las Vegas, offered by Executive Enterprises Institute, presented in conjunction with FEI.

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