An update on how the IFRS Foundation is responding to issues arising from the pandemic
The IFRS Foundation has released a document responding to questions regarding the application of IFRS 9, Financial Instruments, during the current period of enhanced economic uncertainty arising from the Covid-19 pandemic.
At the same time, the foundation said that, despite the challenges arising from the pandemic, the International Accounting Standards Board (IASB) and its technical staff would continue to advance time-sensitive projects, such as the projects on IBOR reform and amendments to IFRS 17, Insurance Contracts, in accordance with the original project plans.
IFRS 9, Financial Instruments
IFRS 9 and Covid-19: accounting for expected credit losses, prepared for educational purposes, highlights requirements within the standard that are relevant for companies considering how the pandemic affects their accounting for expected credit losses (ECL).
It does not change, remove nor add to the requirements in IFRS 9, Financial Instruments. It is intended to support the consistent and robust application of IFRS 9.
The IFRS Foundation said that it and the IASB continue to work in close cooperation with regulators and others regarding the application of IFRS 9, and the document encourages companies to consider guidance provided by prudential and securities regulators.
IFRS 17, Insurance Contracts
At its March 2020 meeting, the IASB tentatively decided to confirm most of the proposals in the Exposure Draft Amendments to IFRS 17, issued in June 2019, with some changes to address feedback on those proposals.
The IASB issued the amendments in June 2020.
The IASB also tentatively decided that IFRS 17 incorporating the amendments will be effective from 1 January 2023. It also tentatively decided to extend the fixed expiry date of the exemption for some insurers from applying IFRS 9 to 1 January 2023.
IFRS 16, Leases: UK delays NHS implementation
The Treasury and the Financial Reporting Advisory Board decided that IFRS 16 implementation in the public sector would be deferred for a further year, to 2021/22. The documents and guidance will be updated in due course on its website.
The foundation has replaced regular meetings with virtual ones where possible. Digital access to public meetings is provided as usual for those who wish to participate in or observe meetings remotely.