IFRS 9 Financial Instruments

Who Should Attend

• Auditors
• Financial controllers
• Regulators
• Risk Managers
• Product Controllers

Objectives

New rules on impairment, hedge accounting and the classification of financial instruments are illustrated, but the course focuses on practical implementation issues and the interaction of the accounting standards with the Basel Regulations.

Agenda

Overview of new impairment rules, new rules for classification of assets, hedge accounting changes and practical issues associated with implementation.

Impact of International Financial Reporting Standard 9

• Fair value v Accruals Accounting
• New Impairment Rules
• Impact on hedge accounting
• Changes to Available for Sale category
• Assessing loans affected by COVID-19, EBS and Bank of England Guidelines
• Case Study: Americredit and Credit Losses

IFRS 9 Fair Value & Cash Flow Hedge Accounting

• Identifying ineffectiveness
• Splitting a hedge between effectiveness and ineffectiveness
• Excluding spot forward differential
• Addressing documentation issues

IFRS 9 – Classification of financial assets

• Amortisation cost measurement category
• FVOCI measurement
• FVTOP measurement
• Subsequent Measurement

IFRS 9 – Contractual Cash Flows

• Measurement of Principal and Interest
• Time value of Money
• Non-recourse assets
• Contractually linked instruments

IFRS 9 – Business model assessment

• Overview and assessment of business model
• Held to collect business model

IFRS 9 – Impairment

• General requirements
• Equity Investments
• Overview of the new impairment model
• Expected credit loss concept
• 12 months expected loss

Dealing with Credit Risk

• Measuring Credit Risk
• Basel Committee on methods to measure credit risk
• Credit Derivatives
• Total Return Swaps and Credit Default Swaps
• How the Accounting Standards Deal with Credit Derivatives