IFRS 9 transitional arrangements – EBA Final Guidelines and the PRA’s “Dear CFO” letter

The EBA’s final Guidelines on disclosure requirements of IFRS 9

Following its consultation in July 2017, the European Banking Authority (EBA) has today published its final Guidelines on disclosure requirements of International Financial Reporting Standard 9 (IFRS 9) or expected credit losses (ECLs) transitional arrangements, specifying a uniform disclosure template institutions should use when disclosing information on own funds, capital and leverage ratios, with and without the application of transitional arrangements for IFRS 9 or ECLs.

The aim of the Guidelines is to ensure consistency and comparability of the data disclosed by institutions during the transition to the full implementation of the new accounting standard. The Guidelines will apply from 20 March 2018.

PRA “Dear CFO” letter on transition disclosures for IFRS 9 financial instruments

On 11 January 2018, the PRA published a Dear CFO” letter”, addressed to the larger UK-headquartered credit institutions, on the transitional disclosure requirements for the IFRS9 financial instruments.

The PRA sets out its expectations on the content of the list of core transition disclosures and covers areas such as:

  • the objective and content of transition disclosures;
  • general comments about transition disclosures; and
  • quantitative measurement uncertainty and sensitivity disclosures.