The Saudi Organization for Chartered and Professional Accountants (SOCPA), through its Accounting Standards Board, has adopted the limited amendments introduced by the International Accounting Standards Board (IASB) to IFRS 9 and IFRS 7.
These amendments add several paragraphs to the application guidance in IFRS 9 to reduce inconsistencies in the application of certain standard requirements identified during the review period and to enhance disclosures in line with IFRS 7 requirements.
Key amendments to IFRS 9 include:
- New application guidance clarifying the timing of financial assets or liabilities recognition and derecognition. The standard specifies this as the date when an entity becomes a party to the instrument's contractual provisions ("recognition date"), when contractual rights to cash flows expire or the asset is transferred ("derecognition date"), and the settlement date ("discharge date due to fulfillment, cancellation, or expiration of contractual obligations").
- Additional guidance on determining settlement dates for financial liabilities processed through electronic payment systems.
- Further clarification on contractual cash flows that constitute solely payments of principal and interest, along with guidance for assessing whether a financial asset's contractual cash flows align with basic lending arrangements.
Key amendments to IFRS 7 include:
- Enhanced disclosure requirements for fair value measurements and fair value gains and losses on investments measured at fair value through other comprehensive income (OCI).
.The full text of these amendments can be accessed by clicking here