designation at fair value through profit or loss, Ch. 44, 7
interaction with the requirements for embedded
designation of non-derivative equity investments at fair value
derivatives, Ch. 46, 3.4.1
through other comprehensive income, Ch. 44, 8
‘business model’ assessment, Ch. 44, 5
effective date, Ch. 44, 10.1; Ch. 47, 16.1
applying in practice, Ch. 44, 5.6
fair value option for own use contracts, Ch. 41, 4.2.6
consolidated and subsidiary accounts, Ch. 44, 5.5
financial assets and liabilities held for trading, Ch. 44, 4
hold to collect contractual cash flows, Ch. 44, 5.2
financial assets classification, Ch. 44, 2
hold to collect contractual cash flows and selling financial
debt instruments, Ch. 44, 2.1
assets, Ch. 44, 5.3
equity instruments and derivatives, Ch. 44, 2.2
impact of sales on the assessment, Ch. 44, 5.2.1
financial instruments within the scope of, Ch. 8, 4.4.5
level at which the business model assessment is applied,
financial liabilities classification, Ch. 44, 3
Ch. 44, 5.1
hedge accounting, Ch. 49, 1.3
transferred financial assets that are not derecognised,
IFRS 4 applying IFRS 9 with, Ch. 51, 10
Ch. 44, 5.2.2
EU ‘top up’, Ch. 51, 10.1.6
classification, Ch. 44, 2
overlay approach, Ch. 51, 10.2
contractual cash flows, Ch. 44, 6
temporary exemption from IFRS 9, Ch. 51, 10.1
auction rate securities, Ch. 44, 6.4.4
impairment, Ch. 47, 4
bonds with a capped or floored interest rate, Ch. 44, 6.3.3
approaches, Ch. 47, 3
contractual features that change the timing or amount,
general approach, Ch. 47, 3.1
Ch. 44, 6.4.4
purchased/originated credit-impaired financial assets,
contractually linked instruments, Ch. 44, 6.6
Ch. 47, 3.3
assessing the characteristics of the underlying pool,
simplified approach, Ch. 47, 3.2
Ch. 44, 6.6.1
calculation of expected credit losses (ECLs), Ch. 47, 7
assessing the exposure to credit risk in the tranche held,
Basel guidance on accounting for ECLs, Ch. 47, 7.1
Ch. 44, 6.6.2
Global Public Policy Committee (GPPC) guidance,
characteristics of underlying pool, assessing, Ch. 44,
Ch. 47, 7.2
6.6.1
interaction between expected credit losses calculations
exposure to credit risk in the tranche held, assessing,
and fair value hedge accounting, Ch. 47, 7.5
Ch. 44, 6.6.2
interaction between the initial measurement of debt
conventional subordination features, Ch. 44, 6.3.1
instruments acquired in a business combination
convertible debt, Ch. 44, 6.4.5
and the impairment model of IFRS 9, Ch. 47, 7.4
de minimis features, Ch. 44, 6.4.1.A
measurement dates of ECLs, Ch. 47, 7.3
debt covenants, Ch. 44, 6.4.4
date of derecognition and date of initial
dual currency instruments, Ch. 44, 6.4.5
recognition, Ch. 47, 7.3.1
five-year constant maturity bond, Ch. 44, 6.4.2
trade date and settlement date accounting, Ch. 47,
fixed rate bond prepayable by the issuer at fair value,
7.3.2
Ch. 44, 6.4.5
determining significant increases in credit risk, Ch. 47, 6
full recourse loans secured by collateral, Ch. 44, 6.3.2
change in the risk of a default occurring, Ch. 47, 6.1
interest rate period, Ch. 44, 6.4.2
collective assessment, Ch. 47, 6.5
inverse floater, Ch. 44, 6.4.5
definition of significant, Ch. 47, 6.3
investment in open-ended money market or debt funds,
factors/indicators of changes in credit risk, Ch. 47, 6.2
Ch. 44, 6.4.5
at initial recognition of an identical group of financial
lender has discretion to change the interest rate, Ch. 44,
assets, Ch. 47, 6.6
6.3.4
multiple scenarios for ‘staging’ assessment, Ch. 47, 6.7
loan commitments, Ch. 44, 6.4.6
operational simplifications, Ch. 47, 6.4
meaning of ‘interest,’ Ch. 44, 6.2
disclosures, Ch. 47, 15
meaning of ‘principal,’ Ch. 44, 6.1
expected credit losses measurement
modified time value of money component, Ch. 44, 6.4.2
12-month expected credit losses, Ch. 47, 6.4.3
multiple of a benchmark interest rate, Ch. 44, 6.4.5
definition of default, Ch. 47, 5.1
Index
163
credit enhancements: collateral and financial
general requirements, Ch. 45, 3.1
guarantees, Ch. 47, 5.8.1
initial fair value and ‘day 1’ profits, Ch. 45, 3.3
expected life vs. contractual period, Ch. 47, 5.5
financial guarantee contracts and off-market loan
information about past events, current conditions and
commitments, Ch. 45, 3.3.3
forecasts of future economic conditions, Ch. 47,
interest-free and low-interest long-term loans, Ch. 45,
5.9.3
3.3.1
lifetime expected credit losses, Ch. 47, 5.2
loans and receivables acquired in a business
probability-weighted outcome, Ch. 47, 5.6
combination, Ch. 45, 3.3.4
reasonable and supportable information, Ch. 47, 5.9
measurement of financial instruments following
sources of information, Ch. 47, 5.9.2
modification of contractual terms that leads to
time value of money, Ch. 47, 5.7
initial recognition of a new instrument, Ch. 45,
undue cost/effort, Ch. 47, 5.9.1
3.3.2
financial assets measured at fair value through other
regular way transactions, Ch. 45, 3.6
comprehensive income, Ch. 47, 5.9
trade receivables without a significant financing
financial guarantee contracts, Ch. 47, 5.11
component, Ch. 45, 3.2
Global Public Policy Committee guidance, Ch. 47, 7.2
transaction costs, Ch. 45, 3.4
history and background, Ch. 47, 1.1
interests in associates and joint ventures accounted for in
IFRS Transition Resource Group for Impairment of
accordance with IFRS 9, Ch. 50, 4.4.9
Financial Instruments (ITG), Ch. 47, 1.5
reclassification of financial assets, Ch. 44, 9
intercompany loans, Ch. 47, 13
recognition, Ch. 45, 2
key changes from the IAS 39 impairment requirements and
general requirements, Ch. 45, 2.1
the main implications of these changes, Ch. 47, 1.3
cash collateral, Ch. 45, 2.1.7
key differences from the FASB’s proposals, Ch. 47, 1.4
firm commitments to purchase/sell goods/services,
lease receivables, Ch. 47, 1.2
Ch. 45, 2.1.2
loan commitments and financial guarantee contracts,
forward contracts, Ch. 45, 2.1.3
Ch. 47, 11
option contracts, Ch. 45, 2.1.4
measurement dates of expected credit losses, Ch. 47, 7.3
planned future/forecast transactions, Ch. 45, 2.1.5
date of derecognit
ion and date of initial recognition,
principal vs. agent, Ch. 45, 2.1.8
Ch. 47, 7.3.1
receivables and payables, Ch. 45, 2.1.1
trade date and settlement date accounting, Ch. 47,
transfers of financial assets not qualifying for
7.3.2
derecognition by transferor, Ch. 45, 2.1.6
modified financial assets, Ch. 47, 8
‘regular way’ transactions, Ch. 45, 2.2
other guidance on expected credit losses, Ch. 47, 1.6
financial assets: general requirements, Ch. 45, 2.2.1
presentation of expected credit losses in the statement of
contracts not settled according to marketplace
financial position, Ch. 47, 14
convention: derivatives, Ch. 45, 2.2.1.B
accumulated impairment amount for debt instruments
exercise of a derivative, Ch. 45, 2.2.1.D
measured at fair value through other
multiple active markets: settlement provisions,
comprehensive income, Ch. 47, 14
Ch. 45, 2.2.1.C
allowance for financial assets measured at amortised
no established market, Ch. 45, 2.2.1.A
cost, contract assets and lease receivables, Ch. 47,
financial liabilities, Ch. 45, 2.2.2
14.1
illustrative examples, Ch. 45, 2.2.5
provisions for loan commitments and financial
settlement date accounting, Ch. 45, 2.2.4
guarantee contracts, Ch. 47, 14.2
trade date accounting, Ch. 45, 2.2.3
requirements, Ch. 47, 1.2
and recognition of gains and losses
revolving credit facilities, Ch. 47, 12
debt instruments measured at fair value through other
scope, Ch. 47, 2
comprehensive income, Ch. 47, 9.1
trade receivables, contract assets and lease receivables,
transition provisions, classification, Ch. 44, 10.2
Ch. 47, 10
applying contractual cash flow characteristics test, Ch. 44,
lease receivables, Ch. 47, 10.2
10.2.3
trade receivables and contract assets, Ch. 47, 10.1
applying the ‘business model’ assessment, Ch. 44, 10.2.2
initial measurement, Ch. 45, 3
date of initial application, Ch. 44, 10.2.1
acquisition of a group of assets that does not constitute a
financial instruments derecognised prior to the date of
business, Ch. 45, 3.3.5
initial application, Ch. 44, 10.2.6
assets and liabilities arising from loan commitments,
making and revoking designations, Ch. 44, 10.2.4
Ch. 45, 3.7
restatement of comparatives, Ch. 44, 10.2.5
loan commitments outside the scope of IFRS 9,
transition adjustments and measurement of financial assets
Ch. 45, 3.7.1
and liabilities, Ch. 44, 10.2.7
loan commitments within the scope of IFRS 9, Ch. 45,
financial assets and liabilities measured at amortised
3.7. 2
cost, Ch. 44, 10.2.7.B
embedded derivatives and financial instrument hosts,
hybrid financial assets, Ch. 44, 10.2.7.A
Ch. 45, 3.5
unquoted equity investments, Ch. 44, 10.2.7.C
164 Index
IFRS 10– Consolidated Financial Statements, Ch. 6, 1–11. See also
parties to a joint operation without joint control, Ch. 12, 6.4
Consolidated financial statements, consolidation procedures
in separate financial statements, Ch. 12, 6.7
continuous assessment, Ch. 6, 9
transactions between a joint operator and a joint operation,
control, Ch. 6, 3
Ch. 12, 6.6
control of specified assets, Ch. 6, 8
accounting for joint ventures, Ch. 12, 7
development of IFRS 10, Ch. 6, 1.2
contributions of non-monetary assets to a joint venture,
disclosure requirements, Ch. 6, 1.4
Ch. 12, 7.2
exposure to variable returns, Ch. 6, 5
interest in a joint venture without joint control, Ch. 12, 7.1
future developments, Ch. 6, 11
in separate financial statements, Ch. 12, 7.3
investment entities, Ch. 6, 10
classification of, Ch. 12, 5
accounting by a parent of an investment entity, Ch. 6,
accompanying IFRS 11, illustrative examples, Ch. 12, 5.5
10.4
contractual terms, Ch. 12, 5.3
accounting by an investment entity, Ch. 6, 10.3
facts and circumstances, Ch. 12, 5.4
definition, Ch. 6, 10.1
legal form of the separate vehicle, Ch. 12, 5.2
determining whether an entity is an investment entity,
separate vehicle or not, Ch. 12, 5.1
Ch. 6, 10.2
continuous assessment, Ch. 12, 8
earnings from investments, Ch. 6, 10.2.3
changes in ownership of a joint arrangement that does not
exit strategies, Ch. 6, 10.2.2
constitute a business, Ch. 12, 8.4
fair value measurement, Ch. 6, 10.2.4
changes in ownership of a joint operation, Ch. 12, 8.3
having more than one investor, Ch. 6, 10.2.6
acquisition of an interest in a joint operation, Ch. 12,
holding more than one investment, Ch. 6, 10.2.5
8.3.1
intermediate holding companies established for tax
control or joint control over a former joint operation,
optimisation purposes, Ch. 6, 10.2.1.B
Ch. 12, 8.3.2
investment entity illustrative examples, Ch. 6, 10.2.9
disposal of interest in a joint operation, Ch. 12, 8.3.5
investment-related services, Ch. 6, 10.2.1.A
former subsidiary becomes a joint operation, Ch. 7,
multi-layered fund structures, Ch. 6, 10.2.10
3.3.3, 7.2; Ch. 12, 8.3.3
ownership interests, Ch. 6, 10.2.8
other changes in ownership of a joint operation,
unrelated investors, Ch. 6, 10.2.7
Ch. 12, 8.3.4
objective of, Ch. 6, 2.1
changes in ownership of a joint venture, Ch. 12, 8.2
power and returns, principal-agency situations, Ch. 6, 6
acquisition of an interest, Ch. 12, 8.2.1
application examples, Ch. 6, 6.6–6.7
becomes a financial asset (or vice versa), Ch. 12, 8.2.5
delegated power: principals and agents, Ch. 6, 6.1
becomes an associate (or vice versa), Ch. 12, 8.2.4
exposure to variability of returns from other interests,
control over a former joint venture, Ch. 12, 8.3.2
Ch. 6, 6.5
disposal of interest in, Ch. 12, 8.2.6
remuneration, Ch. 6, 6.4
former subsidiary becomes a joint venture, Ch. 12,
rights held by other parties, Ch. 6, 6.3
8.3.3
scope of decision-making, Ch. 6, 6.2
interest in a joint venture held for sale, Ch. 12, 8.2.7
power over an investee, Ch. 6, 4
when to reassess under IFRS 11, Ch. 12, 8.1
contractual arrangements, Ch. 6, 4.4
disclosures, Ch. 12, 9
determining whether sponsoring (designing) a structured
effective date, Ch. 12, 2.1
entity gives power, Ch. 6, 4.6
joint control, Ch. 12, 4
existing rights, Ch. 6, 4.2
practical issues with assessing, Ch. 12, 4.4
relevant activities, Ch. 6, 4.1
evaluate multiple agreements togeth
er, Ch. 12, 4.4.2
voting rights, Ch. 6, 4.3
lease/joint arrangement, Ch. 12, 4.4.1
related parties and de facto agents, Ch. 6, 7
relevant activities in
scope, Ch. 6, 2.2
sequential activities, Ch. 12, 4.1.1
combined and carve-out financial statements, Ch. 6, 2.2.6
rights to control collectively, Ch. 12, 4.2
employee benefit plans and employee share trusts, Ch. 6,
delegated decision-making, Ch. 12, 4.2.4
2.2.2
evidence of, Ch. 12, 4.2.3
entity no longer a parent at the end of the reporting
government, role of, Ch. 12, 4.2.6
period, Ch. 6, 2.2.4
potential voting rights and joint control, Ch. 12, 4.2.2
exemption from preparing consolidated financial
protective rights, including some veto rights, Ch. 12,
statements by an intermediate parent, Ch. 6, 2.2.1
4.2.1
interaction of IFRS 10 and EU law, Ch. 6, 2.2.5
related parties and de facto agents, Ch. 12, 4.2.5
investment entity exception, Ch. 6, 2.2.3
sequential activities in, Ch. 12, 4.1.1
IFRS 11– Joint Arrangements, Ch. 12, 1–9. See also Joint
unanimous consent, Ch. 12, 4.3
arrangements
arbitration, Ch. 12, 4.3.3
accounting for joint operations, Ch. 12, 6
arrangements involving passive investors, Ch. 12, 4.3.1
accounting for rights and obligations, Ch. 12, 6.2
ultimate voting authority, Ch. 12, 4.3.2
determining the relevant IFRS, Ch. 12, 6.3
nature of joint arrangements, Ch. 12, 1.1
not structured through a separate vehicle, Ch. 12, 6.1
objective, Ch. 12, 2.2
Index
165
scope, Ch. 12, 2.3
and PxQ, Ch. 7, 3.3.2.D, 7.3; Ch. 14, 5.1.1
application by venture capital organisations and similar
vs. valuation premise, Ch. 14, 5.1.3
entities, Ch. 12, 2.3.1
convergence with US GAAP, Ch. 14, 23
application to joint arrangements held for sale, Ch. 12, 2.3.2
disclosures, Ch. 14, 23.2.4
IFRS 12– Disclosure of Interests in Other Entities, Ch. 13, 1–6. See
fair value of liabilities with demand feature, Ch. 14, 23.2.2
also Disclosure of interests in other entities
practical expedient for alternative investments, Ch. 14, 23.2.1
definitions, Ch. 13, 2.2.1
recognition of day-one gains and losses, Ch. 14, 23.2.3
interaction of IFRS 12 and IFRS 5, Ch. 13, 2.2.1.C
definitions, Ch. 14, 3
interests in other entities, Ch. 13, 2.2.1.A
development of, Ch. 14, 23.1
structured entities, Ch. 13, 2.2.1, 2.2.1.B
disclosures, Ch. 14, 20
International GAAP® 2019: Generally Accepted Accounting Practice under International Financial Reporting Standards Page 988
