Dr. Hanne Böckem
Partner, Audit, DPP
KPMG AG Wirtschaftsprüfungsgesellschaft
In the final report on the Post-Implementation Review of IFRS 9 of 21 December 2022, the IASB had already announced that it would publish an exposure draft in the first quarter of 2023. This was published yesterday under the title Amendments to the Classification and Measurement of Financial Instruments Proposed amendments to IFRS 9 and IFRS 7.
Proposed amendments to the application guidance of IFRS 9 on the following aspects:
Introduction of an option to derecognise financial liabilities that are settled via an electronic payment system before the settlement date, provided that certain conditions are met.
Further explanations on the assessment of the cash flow criterion (SPPI test) for financial assets.
Accordingly, when assessing the cash flow criterion, it is more important what the creditor receives remuneration for than how much remuneration it receives. Furthermore, in the case of contingent payment claims (e.g. depending on the occurrence of contingent events), it should not depend on their probability, but on whether they depend solely on the debtor.
In this regard, two examples are to be included in the standard, including the case where payments are linked to the reduction of greenhouse gas emissions by the debtor (for example, as possible with green, sustainability-linked or other ESG bonds).
Furthermore, it is clarified when payments of contractually linked instruments and non-recourse financial instruments are principal and interest payments on the outstanding principal amount.
Finally, additional IFRS 7 disclosures on equity instruments measured at fair value and disclosures on the potential impact of contingent events on the agreed principal and interest payments are included.
Comments are possible until 19 July 2023.
You can download the draft here.