High Level - Summary 

(i) Classification and Measurement - When an entity credit risk increases, then DO Not book any "GAINS" in the PnL
(ii) Impairment - move from INCURRED Loss model to Forward looking "Expected Credit Loss" model. MOre disclosure on information impacting the Financial asset.
(iii) Hedge Accounting
(i) and (ii) Pretty much in response to the financial crisis years back, the new standard focus solely on Expected Credit Losses (ECL) - prudent approach rather than actually Incurred losses. Eg - from Bank perspective, once drawdown a loan for customers, there is a need to still expect losses along the way rather than book it way too late when actually incurred.
Hence, in other words ..be conservative and be proactive in a sense that although losses haven't been incurred. We still speculate credit risk (book provision for Doubtful) associated with the financial asset due to factors beyond our control (ie economic downturn/recession, competition risk associated with core products that have been acquired from financing (from Banks perspective) and other factors.
From Our perspective with our Audit clients (ie Banks) in Samoa, Samoa has always been vigilant in these areas and as auditors we play a vital part on those Key Audit Matters during any engagement.
Following is a download from IFRS website and above are summary of debriefing from Sue Loyds - Chair (IFRS Interpretation Committee)


IFRS 9 is effective for annual periods beginning on or after 1 January 2018 with early application permitted.

IFRS 9 specifies how an entity should classify and measure financial assets, financial liabilities, and some contracts to buy or sell non-financial items.

IFRS 9 requires an entity to recognise a financial asset or a financial liability in its statement of financial position when it becomes party to the contractual provisions of the instrument. At initial recognition, an entity measures a financial asset or a financial liability at its fair value plus or minus, in the case of a financial asset or a financial liability not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial asset or the financial liability.

Financial assets

When an entity first recognises a financial asset, it classifies it based on the entity’s business model for managing the asset and the asset’s contractual cash flow characteristics, as follows:

  • Amortised cost—a financial asset is measured at amortised cost if both of the following conditions are met:
    • the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows; and
    • the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
  • Fair value through other comprehensive income (FVOCI)—financial assets are classified and measured at fair value through other comprehensive income if they are held in a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets.
  • Fair value through profit or loss (FVTPL)—any financial assets that are not held in one of the two business models mentioned are measured at fair value through profit or loss. Eg Any changes -ve/+ve is taken into either expense or income.

When, and only when, an entity changes its business model for managing financial assets it must reclassify all affected financial assets.

Focusing on the impairment element of the Standard, it also covers how the accounting for loan loss provisioning will change from an incurred to an expected loan loss model and gives an update on how the Standard relates to activity by other organisations such as banking regulators.