IFRS 9 Financial Instruments is effective from 1 January 2018 and replaces IAS 39 Financial Instruments: Recognition and Measurement. It introduces a logical, more principles-based approach to classification and measurement of financial assets based on the entity’s business model and an instrument’s cash flow characteristics. The new forward-looking impairment model requires earlier recognition, and ongoing assessment of credit losses. IFRS 9’s hedge accounting requirements are more principles-based and more closely aligned with the entity’s risk management practices.

This course provides an in-depth analysis of IFRS 9 Financial Instruments. It provides numerous examples and illustrations to explain the business model and cash flow characteristics test for classification of financial assets, amortised cost and fair value measurement of financial assets and financial liabilities, de-recognition of financial assets (retained servicing, continuing involvement etc.), measurement of expected credit losses and the accounting and impact of different types of hedges on financial statements. In addition, it covers the disclosures in IFRS 7 and the principles of fair value measurement in IFRS 13.

The course is designed to help preparers and users of financial statements to evaluate the impact of IFRS 9 on the business and its financial statements.

Learning objectives:

This course is beneficial to preparers and users of IFRS financial statements. The participants will learn the principles in IFRS 9, and its application.

  • Classify and measure financial assets under the three categories in IFRS 9
  • Analyse the impact of IFRS 9 on the classification of financial assets, including embedded derivatives
  • Classify and measure financial liabilities under the two categories in IFRS 9
  • Evaluate the principles of fair value measurement in IFRS 13
  • Apply the principles in relation to de-recognition of financial assets
  • Calculate the impairment loss on loans and other financial assets under the expected credit loss model in IFRS 9
  • Analyse the estimates and judgements in the expected credit loss impairment model
  • Apply the hedge accounting model in IFRS 9 and learn how it is aligned more closely to common risk management practices compared to IAS 39

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Skill Level: Beginner