The International Accounting Standards Board (IASB) has published today for public comment proposals for limited changes to the classification and measurement requirements for financial instruments under IFRS 9: Financial Instruments.

The proposals form part of a wider project to reform accounting for financial instruments, and are part of the Classification and Measurement phase of that project. The IASB published new classification and measurement requirements for financial assets in 2009 and for financial liabilities in 2010.

However, in January 2012 the IASB decided to consider limited amendments in order to:

clarify a narrow range of application questions;

reduce key differences with the US Financial Accounting Standards Board's (FASB) tentative classification and measurement model to achieve increased comparability internationally in the accounting for financial instruments; and

take into account the interaction between the classification and measurement of financial assets and the accounting for insurance contract liabilities.

Chris Spall, partner in KPMG International Standards Group, said: 'Companies, in particular financial institutions, should start re-looking at their financial assets and at how the proposed amendments might impact them. Although these amendments are labelled "limited", they could have far-reaching implications for an entity's financial reporting.'

The exposure draft can be accessed via the project website or on the Comment on a proposal section of the ifrs.org website. A high level summary of the proposals can be found HERE.