IFRS 9 Changes To Financial Assets Accounting And Its Tax Implications

The global credit crunch/financial crises that began in 2008 and the recession that followed were largely blamed on the complex financial assets and liabilities introduced to the markets whose credit risks were not effectively captured by the financial reporting framework for financial instrument at the time (International Accounting Standard 39). The process to change this standard began immediately in 2009, with further amendments in 2010 and 2013. The new standard, International Financial Reporting Standards (IFRS) 9, was finally issued on July 1, 2014. The effective date for the new standard was then set at January 1, 2018 to give enough room for companies and businesses to study and assess the potential impact of the new standard on their statement of financial position (SOFP).