PiR IFRS 9, Phase 2 – Impairment: IASB work reaches a conclusion

the summary of findings and feedback statement can be found here.

The Board focuses in particular on matters requiring action. These are:

• targeted improvements to credit risk disclosures under IFRS 7. These disclosures include those relating to the impact of climate risks on the methods used to calculate the impairment of a financial asset, which are the subject of an illustrative example in the exposure draft on disclosures of climate risks and other uncertainties in financial statements (see above);

• clarification of the interaction of the impairment requirements and other IFRS 9 provisions, such as modification of contractual cash flows, derecognition and write-offs, along with aspects of presentation in the income statement, such as a component of the cost of risk. These will be examined in the IASB’s ongoing Amortised Cost Measurement project;

• the postponement of questions relating to financial guarantee contracts (FGC), considered low priority matters, to the next agenda consultation. The questions raised relate to:

• assessing whether a financial guarantee contract held is an integral part of the contractual terms of a loan; • accounting for a non-integral financial guarantee contract held;

• accounting for a financial guarantee contract issued for which premiums are received over time.