IFRS 9: Advanced Financial Instrument

A lot of subject matter experts expect the adoption of IFRS 9 to be challenging; hence, the need to get the right skills to efficiently apply the standard seamlessly. The three major domains to be considered while implementing IFRS 9 include measurement, impairment, and hedge accounting:

• Classification and Measurement
  • Classification under IFRS 9 for investments in debt instruments is driven by the entity’s business model and their contractual cash flow characteristics.
  • A financial asset is measured at amortized cost if both of the following criteria are met:
    • The asset is held to collect its contractual cash flows; and
    • The asset’s contractual cash flows represent ‘solely payments of principal and interest’ (‘SPPI’)

• Impairment
  • Based on Expected Loss Model

• Hedge Accounting
  • New Hedge Accounting Guidelines

Training Objectives

• Gain an understanding of the requirements of IFRS 9 in relation to initial recognition, classification, and measurement of financial instruments
• Identify the key difference between the incurred loss model and the expected loss model
• Understand the calculation of impairment using the Expected Credit Loss (ECL) Model
• Understand the impact of ECL
• Develop competencies in Credit Risk Modeling and apply the same to my company
• Develop competencies to apply the guidance of IFRS 9

Methodology

• Instructor guided presentation
• Case studies
• Discussion session
• Scenario and Case study sessions

What to Expect

• Expert facilitation
• Souvenirs (classroom option)
• Tea break and Lunch (classroom option)
• Discussion session
• Practical Examples
• Certificate

Course Outline

• Introduction and Scope of IFRS 9
• Initial Recognition
• Classification and measurements
  • Classification of financial assets and financial liabilities
  • Derivatives
  • Embedded derivatives
  • Reclassification of financial assets
  • Measurement of financial assets and financial liabilities
    • Valuation of financial assets:
      • Quoted securities:
        • Bonds, Bills etc.
        • Equities
      • Unquoted securities
        • Investments in unquoted shares:
          • Using DCF technique
          • Using NA technique
          • Using DNA technique
• Derecognition:
  • Financial assets
    • Derecognition
    • Write-off
    • Transfers that qualify for derecognition
    • Transfers that do not qualify for derecognition
    • Continuing involvement in transferred assets
    • Continuing involvementF in only a part of transferred assets
    • Modification of contractual cash flows
  • Financial liabilities
    • Derecognition
    • Extinguishment accounting
    • Partial extinguishment accounting
• Impairments:
  • Scope of the impairment requirements
  • Overview of the impairment requirements
  • Determining significant increases in credit risk
• Financial Instruments Disclosure