This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our cookie notice for more information on the cookies we use and how to delete or block them.

IFRS 7 Issues

Date recorded:

This session aimed to seek Board's input on certain minor issues identified during the discussions on improving IFRS 7 in the light of the financial crisis. Constituents were concerned over some burdensome minimum disclosure requirements and that qualitative and quantitative disclosures are not integrated. The staff proposed a series of minor amendments. As a general amendment the staff proposed to change IFRS 7.32 by adding a statement that qualitative disclosures and quantitative disclosures should be integrated. The Board agreed.

The following list summarises the minor issues, the staff recommendation and the Board's decision:

Paragraph in IFRS 7

Description

Staff Recommendation

Board Decision

36(a)

Maximum exposure to credit risk

Clarify that disclosure only applies to assets for which their maximum exposure to credit loss differs from their carrying amounts

Agreed

36(d)

Financial assets with renegotiated terms

Remove

Agreed

37(a)

Ageing analysis

Remain unchanged

Agreed

37(b)

Individually impaired financial assets

Add a new disclosure requiring an entity to disclose an analysis of financial assets that are collectively assessed for impairment at the end of the reporting period

Disagreed

37(c)

FV of collateral and other credit enhancements

Require disclosure of over- and under-collateralisation

Remove 37(c) but enhance IFRS 7.36

38

Foreclosed collateral

Clarify that need only disclose amount held at reporting date

Agreed

40(a)

Impact on profit or loss and equity

State in Implementation Guidance that encouraged to discuss effect of analysis on economic value

Disagreed

41

Stress testing

No requirement needed

Agreed

15

Selling or repledging collateral

Remain unchanged

Agreed

32

Qualitative and quantitative disclosure

Insert sentence stating that qualitative should support quantitative disclosure

Agreed

34(b)

Materiality

Remove reference to materiality

Agreed

The staff recommended to the Board to process the agreed changes via the annual improvements process. The Board agreed.