PRMIA Lunchtime Presentation

On 3 September 2010, the Singapore Chapter of the Professional Risk Managers' International Association ("PRMIA") organised a lunchtime presentation by Chay Yiowmin, Partner and Head of Financial Services at Moore Stephens LLP. Yiowmin provided an overview of IFRS 9, issued by the International Accounting Standards Board ("IASB") in November 2009. IFRS 9 currently incorporates Phase 1 of the financial instruments' project expected to replace the classification and measurement requirements on financial assets under IAS 39.

Yiowmin briefly explained the gist of IAS 39 and IFRS 9 and the logic behind replacing IAS 39 with IFRS 9. Yiowmin also provided a comparison for the various financial asset categories as prescribed by the respective standards. With regards to unquoted equity investments, the cost measurement is not permissible under IFRS 9, as compared to IAS 39. In the absence of observable market data, entities need to develop realistic valuation models consistent with the investment objectives.

Yiowmin concluded his presentation by providing a glimpse of the subsequent changes that will occur in Phase 1 with the introduction of the fair value concept for financial liabilities. Phases 2 and 3 of IFRS 9 will relate to impairment methodology and hedge accounting respectively. IFRS 9 will come into force in 2013 with an incentive for early adoption.

Please click here for the presentation materials.