The International Accounting Standards Board
(IASB) has issued amendments to IFRS 7.
IFRS 7 Financial Instruments is the standard
applied to disclosures as part of its comprehensive review of
off-balance sheet activities.
The amendments allow improved understanding of
financial asset transfer transactions and the risks that may remain
with the entity that transferred the assets.
Additional disclosure is now required if a
disproportionate amount of transfer transactions occur at the end
of a reporting period.
The IASB decided to retain existing
de-recognition requirements based on feedback from IAS 39 Financial
Instruments – Recognition and Measurement and the associated
disclosure requirements in IFRS 7.
Improved disclosure requirements for IFRS 7
are contained in Disclosures – Transfers of financial assets.
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By GlobalData“These are important disclosure requirements
that will help investors to better understand off-balance sheet
risks, and to alert them to the possibility of so-called ‘window
dressing’ transactions occurring at the end of a reporting period,”
IASB chairman David Tweedie said.
