IFRS for Banking – IFRS 9 Financial Instruments

Overview

The IFRS 9 financial instruments course demands a clear understanding of the entity's business model and contractual cash flow characteristics of financial assets.

This course provides an in-depth analysis of IFRS 9 Financial Instruments. It provides numerous examples and illustrations to explain the business model and the cash flow characteristics test for classification of financial assets, amortised cost and fair value measurement of financial assets and financial liabilities, de-recognition of financial assets (retained servicing, continuing involvement etc.), measurement of expected credit losses and the accounting and impact of different types of hedges on financial statements. In addition, it covers the disclosures in IFRS 7 and the principles of fair value measurement in IFRS 13.

Objective

• Identify the key topics in IFRS 9, including recent regulatory updates.
• Assess the major changes in accounting principles for financial instruments.
• Understand the regulatory framework for financial instruments by reviewing IAS 32, IFRS 7, IFRS 9, IFRS 13, and relevant IFRIC guidance.
• Classify and measure financial liabilities under the two categories in IFRS 9.
• Evaluate the principles of fair value measurement in IFRS 13.
• Classify, measure, and account for financial assets and liabilities using the business model and SPPI (Solely Payments of Principal and Interest) tests under IFRS 9.
• Apply the expected credit loss (ECL) model, including recognition and measurement of 12-month and lifetime ECLs, credit risk stage assessment, and use of both general and simplified impairment approaches.
• Design and account for hedge strategies by understanding hedging requirements, evaluating hedge effectiveness, and calculating hedging costs.
• Analyze the financial and operational impacts of IFRS 9 on banks and other financial institutions.