The International Accounting Standards Board (IASB) has issued the exposure draft, Prepayment Features with Negative Compensation (Proposed amendments to IFRS 9) (Exposure Draft). The Exposure Draft proposes minor, narrow-scope amendments to International Financial Reporting Standard (IFRS) 9, Financial Instruments, which address concerns expressed by stakeholders relating to how prepayable financial assets should be classified under IFRS 9.
The amendments would permit companies to measure particular financial assets with negative compensation features at amortised cost or at fair value through other comprehensive income, provided specific conditions are met.
The IASB also proposes that the amendments in the Exposure Draft have the same effective date as IFRS 9, annual periods beginning on or after 1 January 2018.
The exposure draft is available on this link.
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