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IBOR reform and IFRS® Standards

IBOR reform and IFRS

Considering the impacts of benchmark interest rate reform on IFRS accounting

Considering the impacts of benchmark interest rate reform on IFRS accounting

Considering the impacts of benchmark interest rate reform on accounting under IFRS Standards

Standard setters have considered the effects of unprecedented reform of interbank offered rates (IBOR) – the benchmark interest rates that underpin the measurement of many financial instruments – on existing financial reporting requirements.

The International Accounting Standards Board (the Board) has engaged in a two-phase process of amending its guidance to assist in a smoother transition away from IBOR.

  • Phase 1 – The first phase of amendments to IFRS 9 Financial Instruments, IAS 39 Financial Instruments: Recognition and Measurement and IFRS 7 Financial Instruments: Disclosures focused on hedge accounting issues. The final amendments, issued in September 2019, amended specific hedge accounting requirements to provide relief from the potential effects of the uncertainty caused by IBOR reform. The amendments are effective from 1 January 2020 and are mandatory for all hedge relationships directly affected by IBOR reform.
  • Phase 2 – The second phase amendments1 focus on the financial reporting issues that may arise when IBOR rates are either reformed or replaced. These amendments, issued on 27 August 2020, adjusted specific requirements in IFRS Standards relating to:  
    • modifications of financial instruments and lease liabilities; 
    • hedge accounting; and 
    • disclosures. 

Read our web articles for a more detailed overview of the Phase 1 and Phase 2 final amendments.

You can also find out more about the Board’s IBOR reform project on

Bookmark this page and stay tuned for further updates in the coming weeks.

1 Interest Rate Benchmark Reform—Phase 2: Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16

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