Applying IFRSs presents significant challenges for financial institutions. The accounting requirements for financial instruments also affect the related disclosures. Utilizing a highly interactive format, this course provides a comprehensive overview of the effects that the requirements have on the financial statements of financial institutions.

This three-day program offers invaluable guidance on meeting the requirements of current accounting principles and disclosure requirements. Coverage includes lending and repossessed assets, accounting implications of regulatory requirements, disclosures, and IFRS 13 Fair Value Measurement. The complex requirements of IFRS 9 Financial Instruments are discussed and explained. Numerous examples and illustrations are provided, including application of the effective interest method under various scenarios, retained servicing, loan commitments and financial guarantees, loan impairment and restructurings, derivatives and hedging and how IFRS 15 applies to financial institutions. Where applicable, IFRSs are contrasted with US GAAP requirements.

The theory and application of the standards is demonstrated with illustrative examples, complemented by application of the standards in an interactive group environment utilizing case studies, model financial statements, and practical exercises.

This course answers questions such as:

  • What are the current IFRS reporting requirements for financial institutions? When and how can financial instruments be reclassified?
  • What are the accounting requirements for loan losses, repossessed assets, and fee income? How are effective interest rates calculated for various financial instruments?
  • What principles apply to the recognition, measurement, impairment, and derecognition of financial instruments?
  • How does the guidance in IFRS 9 apply to the ‘expected credit loss model’?
  • What are the recognition and measurement principles for investment property?
  • What are the significant changes that will result from applying IFRS 9’s hedge accounting?
  • How are the disclosure requirements of IFRS 7 applied in practice?
  • Which revenue streams in financial institutions does IFRS 15 apply to?
  • What are the implications of the application of IFRS 16 on the financial statements of banks and other financial institutions?

Learning Objectives

  • Classify and measure financial assets under IFRS 9’s three categories
  • Prepare the quantitative and qualitative disclosures for financial instruments required by IFRS 7
  • Calculate impairment of loans and other financial assets under the expected credit loss model in IFRS 9
  • Calculate the effective interest rates for various financial instruments common to the financial sector
  • Determine the principles in relation to recognition and measurement of investment property in IAS 40
  • Differentiate embedded derivatives between those that must be accounted separately and those that do not require separation from their host instruments under IFRS 9
  • Apply the hedge accounting requirements
  • Determine when IFRS 15 versus IFRS 9 applies to revenue recognition
  • Apply the principles in IFRS 16

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Skill Level: Beginner