IFRS 9 Financial Instruments

Objectives 

Our training allows the staff representing all above areas to get acquainted with the requirements of the new standard and the implications on the institution and its processes. Simultaneously, the training represents an opportunity to align the level of accounting knowledge across institutions.  

Programme 

• Main reasons for substitution of the previously effective IAS 39 with the new IFRS 9
• Scope of IFRS 9
• Review of other IASs and IFRSs relating to financial instruments and their interactions with IFRS 9

Classification and measurement of financial instruments  

• Accounting categories determining how financial instruments are presented and measured in the financial statements
• Criteria of classifying financial assets and financial liabilities to a given category: the business model test and “SPPI” test
• Approach to structured (hybrid) financial instruments – criteria of bifurcation of embedded derivatives from the host contract
• Reclassification of financial assets and financial liabilities 

Fair value of financial instruments 

• Definition of fair value inaccordance with IFRS 13 and fairvalue “hierarchy”
• Approach to presentation of fairvalue changes for financial assetsand financial liabilities in different categories
• Fair value adjustment due tochanges in credit risk of the issuer 

Derecognition of financial assets and financial liabilities 

• Derecognition criteria in accordancewith IFRS 9 and their application tosecuritisationand factoringagreements
• Application of derecognitioncriteriato modification of contractual termsof financial assets and financialliabilities

Impairment of financial assets 

• Overview of the new expected lossimpairment model as contrastedwith the old incurred loss model
• Definition of expected losses: 12-month EL and life-time EL
• Significant deterioration of creditquality, transfer between 12-monthEL and life-time expected loss
• Explanation of the 3-stage approachof loss provisioning and accountingtreatment for financial assetsclassified to each of the stages
• Simplified approach to the 3-stageapproach and how it can be applied
• Modification of financial assets andits impact on loss provisioning
• Purchased or originated credit-impaired assets (POCI) andapproach to their measurementusing credit-adjusted effectiveinterest rate 

Hedge accounting 

• Explanation of the idea of hedge accounting. Economic hedges andaccounting hedges.
• Cash flow hedge accounting and fairvalue hedge accounting –examplesand accounting treatment
• Hedged positions and hedging instruments
• Hedge accounting documentation and effectiveness testing
• The new hedge accounting model featured in IFSR 9 and mainchanges in comparison with IAS 39: hedging of net position, designation of time value of options to hedge accounting, hedging of non-financial risks, hedge re-balancing. 

Disclosures 

• The scope of mandatory disclosures relating to financial risks and financialinstruments as required by IFRS 7
• New disclosures required byimplementation of IFRS 9, in particularin connection with impairment offinancial assets and hedge accounting
• Disclosures required when IFRS 9 is applied for the first time

Impact of implementation of IFRS 9 on financial statements of banks and financial institutions. 

26-27 October, 2020, Warsaw 

It is possible to organize a in-house training course on the individual customer's order. 

Contact 

Aleksandra Trych | tel. +48 505 171 636 | aleksandra.trych@pl.ey.com

Educational points/units 

CPD (Continuing Professional Development) - our trainings meet the requirements of international professional organizations (ACCA, IIA) regarding the further education of their members.