Credit Risk in Liability Measurement
The IASB is examining the area of credit risk in liability measurement as part of its comprehensive review of accounting issues emerging from the global financial crisis.
The issue is relevant to a number of the IASB’s projects - in particular in the accounting for financial instruments, insurance, fair value measurement and provisions, contingent liabilities and contingent assets.
Where are we in the project?
The project team is currently analysing the responses received on the IASB’s invitation to comment. The staff paper referred to in the invitation to comment outlines the three most often-cited arguments in favour of including credit risk in current measurement of liabilities and the three most often-cited arguments against. The comment period for the paper closed 1 September 2009.
View the comment letters received here.
What will happen next?
The IASB started discussing the responses to the discussion paper in its September 2009 board meeting and will continue its discussions in October 2009. However, because this is a cross-cutting issue that relates to several of the IASB’s projects, potential conclusions of the Board may be incorporated in the relevant existing IASB projects.