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IFRS® Accounting Standards

Initial Application of IFRS 17 and IFRS 9―Comparative Information (Amendment to IFRS 17)

Summary

The Accounting Standards Board (AcSB) is participating in the International Accounting Standards Board’s (IASB) project to amend IFRS 17 Insurance Contracts. The objective of this project is to help entities increase the usefulness of comparative information presented on initial application of IFRS 17 and IFRS 9 Financial Instruments

IFRS 17 and IFRS 9 have different requirements for comparative information:

  • IFRS 17 requires entities to present one restated comparative period. 
  • IFRS 9 permits but does not require restatement of comparative periods, and prohibits entities from applying IFRS 9 to financial assets derecognized in the comparative period. 

The proposed amendment is an optional classification overlay for financial assets to which IFRS 9 has not been applied in the comparative periods. Applying the proposed amendment, an entity would be permitted to present comparative information about such a financial asset as if the classification and measurement requirements of IFRS 9 had been applied to that financial asset.

The AcSB’s due process includes ensuring that Canadian entities’ financial reporting needs are considered by the IASB and issuing the AcSB’s own exposure draft on each IASB proposal. Subject to the responses to the AcSB’s exposure draft on whether the IASB’s proposals are appropriate for application in Canada, the AcSB expects that the amendments will be incorporated into Canadian GAAP in accordance with the AcSB’s strategy of adopting IFRS® Standards for publicly accountable enterprises.

Staff Contact(s)

Katharine Christopoulos, CPA, CA Director, Accounting Standards Board

Davina Tam, CPA, CA Principal, Accounting Standards Board

Project Status

  • Information gathering

    Completed prior to June 2021

  • Approving project

    The IASB approved the project in June 2021

  • Consulting stakeholders

    IASB Exposure Draft issued in July 2021

    AcSB Exposure Draft, which corresponds to the IASB Exposure Draft, issued in August 2021

  • Deliberating feedback

    The IASB and AcSB are deliberating comments on their Exposure Drafts

  • Final pronouncement

    The IASB issued the final amendment in December 2021

    The AcSB endorsed and incorporated into Canadian GAAP the IASB’s amendment to IFRS 17 Insurance Contracts. IFRS 17, including this amendment, is effective for annual reporting periods beginning on or after January 1, 2023.

News


March 1, 2022

International Activity, News

AcSB endorses Initial Application of IFRS 17 and IFRS 9―Comparative Information (Amendment to IFRS 17)

The amendment is now in Part I of the CPA Canada Handbook – Accounting. This amendment adds a transition option relating to comparative information about financial assets presented on initial application of IFRS 17 to improve the usefulness of the information presented. IFRS 17, including this amendment, is effective for annual reporting periods beginning on or after January 1, 2023.

December 15, 2021

International Activity

Update – IASB issues narrow-scope amendment to IFRS 17

The IASB issued a narrow-scope amendment to the transition requirements in IFRS 17 Insurance Contracts. The amendment provides insurers with an option aimed at improving the usefulness of information to investors on initial application of the new Standard. The AcSB will ballot the final amendment and complete its endorsement process in Q1 2022.

October 6, 2021

News

AcSB Response – Initial Application of IFRS 17 and IFRS 9—Comparative Information

On September 27, 2021, the AcSB responded to the IASB’s Exposure Draft, issued in July 2021. The AcSB’s letter supports the proposed amendment and provides suggestions to further enhance the usefulness of the comparative information presented. The suggestions include broadening the scope of the classification overlay to cover all financial assets and considering additional disclosures. Read our letter to find out more!  

August 17, 2021

Document for Comment

AcSB Exposure Draft – Initial Application of IFRS 17 and IFRS 9―Comparative Information (Proposed amendment to IFRS 17)

The AcSB issued its Exposure Draft that corresponds to the IASB’s Exposure Draft on this topic. Canadian stakeholders who would like their feedback considered prior to the AcSB finalizing its comment letter are encouraged to submit comments to the AcSB by September 15, 2021.

August 4, 2021

International Activity

IASB Exposure Draft – Initial Application of IFRS 17 and IFRS 9—Comparative Information (Proposed amendment to IFRS 17)

The IASB issued an Exposure Draft proposing an amendment to IFRS 17 Insurance Contracts. The amendment is targeted in nature to improve the usefulness of comparative information presented on initial application of IFRS 17 and IFRS 9 Financial Instruments. Canadian stakeholders are encouraged to submit their comments to the IASB by September 27, 2021.

Meeting & event summaries


September 30, 2021

AcSB Decision Summary – September 15-16, 2021

The AcSB discussed its draft response letter to the International Accounting Standards Board’s (IASB) Exposure Draft, “Initial Application of IFRS 17 and IFRS 9—Comparative Information (Proposed amendment to IFRS 17).” The Board considered feedback from its Insurance Transition Resource Group on the proposal and provided staff with comments to incorporate into the final letter. The Board encourages stakeholders to share their views on the Exposure Draft by submitting their response letters to the IASB by September 27, 2021, with a copy to the AcSB.

August 4, 2021

AcSB Decision Summary – July 21-22, 2021

The AcSB received an overview of the expected narrow-scope amendment to IFRS 17 Insurance Contracts. This targeted proposal aims at improving the usefulness of comparative information presented on initial application of IFRS 17 and IFRS 9 Financial Instruments.

The AcSB discussed and approved a plan to respond to the forthcoming exposure draft, which includes consulting with its Insurance Transition Resource Group

The AcSB encourages Canadian stakeholders to continue with their implementation efforts. The Board further notes that entities would need to collect information starting from the transition date of IFRS 17 to apply the proposed amendment. Therefore, the Board encourages entities to follow this project to assess potential implications for their implementation efforts.

Disclaimer

This project summary has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on this project, which may change after further Board deliberations. Decisions to publish Handbook material are final only after a formal voting process.