The International Accounting Standards Board (IASB) is proposing amendments to IAS 32 to improve the financial reporting on instruments that have both debt and equity features.
The standard works well for most financial instruments. However, the instruments have evolved since the IFRS standard was issued – they are more complex and present new reporting challenges for companies.
Companies’ solutions to the reporting challenges differ resulting in diverse accounting practices that make it difficult for investors to assess and compare companies’ financial position and performance.
There has been some noise coming from investors, particularly about equity instruments.
Andreas Barckow, chair of IASB, said: “Our goal is to bring more transparency to investors, ensuring that they have high-quality information about complex financial instruments when making investment decisions.”
