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BC1. In 2010 the International Public Sector Accounting Standards Board (IPSASB) issued three new standards dealing with financial instruments. These standards substantially aligned the requirements for financial instruments in IPSAS with the requirements in IFRS Standards at that time. However, the IPSASB was aware that the IASB was in the process of updating the requirements for financial instruments and had already issued the first version of IFRS 9 Financial Instruments. The IPSASB was also aware that the completion of IFRS 9 could take a number of years. It therefore decided to monitor the IASB’s work on IFRS 9, with the intention of initiating a project to develop a standard based on IFRS 9, once IFRS 9 had been completed.
BC2. The IASB issued the final version of IFRS 9 in July 2014. IFRS 9 introduced a number of changes to the recognition and measurement of financial instruments, including new classification and measurement requirements for financial assets, new hedging requirements and a new impairment model for financial assets. IFRS 9 was effective for annual periods beginning on or after 1 January 2018.
BC3. The IPSASB began work on a project to update its financial instrument standards in 2016 and issued IPSAS 41 Financial Instruments, which is substantially converged with IFRS 9, in August 2018. IPSAS 41 superseded most of the requirements in IPSAS 29 Financial Instruments: Recognition and Measurement. Consistent with the fact that IFRS 9 permitted entities to continue applying the hedge accounting requirements in IAS 39 Financial Instruments Recognition and Measurement, IPSAS 41 permitted entities to continue applying the hedge accounting requirements in IPSAS 29.