What is the “Equity"? – Proposed Amendments of IFRS

The IASB has published the Exposure Draft. It aims to address challenges in how a company that issues financial instruments distinguishes financial liabilities from equity instruments. Learn more.

Overview

How can the IASB address the challenges that companies face in differentiating between financial liabilities and equity instruments when issuing them? What requirements will meet the information needs of investors? The IASB has a project underway – FICE – that is attempting to solve some of the issues that have developed as financial instruments and the company’s capital structures have become increasingly complex.  

The IASB has published the Exposure Draft. The exposure draft aims to address challenges in how a company that issues financial instruments distinguishes financial liabilities from equity instruments especially when those financial instruments contain characteristics of both financial liabilities and equity instruments. Classification challenges can result in varied accounting practices, which in turn makes it difficult for investors to assess and compare companies’ financial position and performance. The exposure draft also aims to meet the information needs of investors, both in terms of presentation and disclosures in the financial statements. Better information leads to better decisions. 

Speakers: 
Mr. Zachary Gast, Board member, IASB
Ms. Angie Ah Kun, Technical staff, IASB
Mr. Nao Makino, Head of Research, Kaname Capital LP
Mr. Robert Huth, CFA, Chair of Corporate Disclosure Policy Council, CFA Institute
Ms. Jin A Choi ESG Analyst, Mirae Asset Securities

Recorded on: 4 March 2024  Duration: 1 hour 23 min 48 sec.