{"id":3602,"date":"2019-03-13T04:25:00","date_gmt":"2019-03-13T04:25:00","guid":{"rendered":"https:\/\/hk.valtech-valuation.com\/ifrs-9s-application\/"},"modified":"2019-03-13T04:25:00","modified_gmt":"2019-03-13T04:25:00","slug":"ifrs-9s-application","status":"publish","type":"post","link":"https:\/\/hk.valtech-valuation.com\/cn\/ifrs-9s-application\/","title":{"rendered":"IFRS 9’s Application"},"content":{"rendered":"

Background<\/h3>\n

IFRS 9 Financial Instruments is the IASB\u2019s replacement of IAS 39 Financial Instruments: Recognition and Measurement. The Standard includes requirements for recognition and measurement, impairment, derecognition\u00a0and general hedge accounting.\u00a0The version of IFRS 9 issued in 2014 supersedes all previous versions and is mandatorily effective for periods\u00a0beginning on or after 1 January 2018 with early adoption permitted (subject to local endorsement requirements).\u00a0For a limited period, previous versions of IFRS 91 may be adopted early, provided the relevant date of initial
\napplication is before 1 February 2015 (again, subject to local endorsement requirements).<\/p>\n<\/div>

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General approach<\/h3>\n

With the exception of purchased or originated credit-impaired financial assets (which are considered separately\u00a0below), expected credit losses are required to be measured through a loss allowance at an amount equal to:
\n– 12-month expected credit losses (expected credit losses that result from those default events on the financial\u00a0instrument that are possible within 12 months after the reporting date); or
\n– lifetime expected credit losses (expected credit losses that result from all possible default events over the life of\u00a0the financial instrument).<\/p>\n<\/div>

  • <\/i><\/span>
    \n

    Business model test<\/p>\n<\/div><\/li>

  • <\/i><\/span>
    \n

    Cash flow characteristics test<\/p>\n<\/div><\/li><\/ul>

    <\/div>

    A loss allowance for lifetime expected credit losses is required for a financial instrument if the credit risk on that\u00a0financial instrument has increased significantly since initial recognition. It is also required for contract assets or\u00a0trade receivables that are not, according to IFRS 15, considered to contain a significant financing component.\u00a0Additionally, entities can elect an accounting policy of recognising lifetime expected credit losses for all contract
    \nassets and\/or all trade receivables, including those that contain a significant financing component. The same\u00a0election is also separately permitted for lease receivables.\u00a0For all other financial instruments, expected credit losses are measured at an amount equal to the 12-month\u00a0expected credit losses.<\/p>\n<\/div><\/div><\/div><\/div><\/div>\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":1,"featured_media":3603,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[152],"tags":[],"class_list":["post-3602","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-valtech-cn"],"_links":{"self":[{"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/posts\/3602","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/comments?post=3602"}],"version-history":[{"count":0,"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/posts\/3602\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/media\/3603"}],"wp:attachment":[{"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/media?parent=3602"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/categories?post=3602"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hk.valtech-valuation.com\/cn\/wp-json\/wp\/v2\/tags?post=3602"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}