In March 2009 the IASB enhanced the disclosures about fair value and liquidity risks in IFRS 7. The Board also amended IFRS 7 to reflect that a new financial instruments Standard was issued—IFRS 9 Financial Instruments, which related to the classification of financial assets and financial liabilities.

IFRS 7 requires entities to provide disclosures in their financial statements that enable users to evaluate: the significance of financial instruments for the entity’s financial position and performance.

IFRS 7, titled Financial Instruments: Disclosures, is an International Financial Reporting Standard (IFRS) published by the International Accounting Standards Board (IASB). It requires entities to provide certain disclosures regarding financial instruments in their financial statements. [1]

If an entity is required to present the effects of changes in a liability’s credit risk in profit or loss (see paragraph 5.7.8 of IFRS 9), the disclosure must include a detailed description of the economic relationship described in paragraph B5.7.6 of IFRS 9.

The main principle of disclosure for IFRS 7 is that an ‘entity shall disclose information that enables users of its financial report to evaluate the significance of financial instruments for its financial position and performance. There are no recognition or measurement requirements included within IFRS 7. DISCLOSURES

IFRS 7 applies to all recognised and unrecognised financial instruments (including contracts to buy or sell non-financial assets) except: Interests in subsidiaries, associates or joint ventures, where IAS 27/28 or IFRS 10/11 permit accounting in accordance with IAS 39/IFRS 9 Assets and liabilities resulting from IAS 19

IFRS 7 Financial Instruments: Disclosures requires disclosures about the significance of financial instruments on financial performance and position, and the nature and extent of risks arising. This page provides information on the standard and amendments, with ICAEW factsheets and guides.