Current Development in Accounting Thought

Running head: CURRENT DEVELOPMENT IN ACCOUNTING THOUGHT
Current Development in Accounting Thought
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CURRENT DEVELOPMENT IN ACCOUNTING THOUGHT
1
Contents
Introduction:....................................................................................................................................2
Discussion:.......................................................................................................................................2
Conclusion:......................................................................................................................................6
References:......................................................................................................................................8

CURRENT DEVELOPMENT IN ACCOUNTING THOUGHT
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Introduction:
International Accounting Standards Board (IASB) follow a standard procedure while
issuing new accounting standards and issuing amendments. Exposure draft is the preliminary
draft which is issued and kept open for comment by different stakeholders before finalizing a
new accounting standards or amendments in accounting standards. Analysis of ‘interest rate
benchmark reform’ exposure draft shall be made in this document to understand the impact of
such draft on financial reporting.
Discussion:
Exposure draft ‘interest rate benchmark reform’ by amendments to International
Financial Reporting Standards IFRS 9 and IAS 39.
Cost of obtaining unsecured funds in certain combination of currency and maturity represented
by LIBOR, EURIBOR, and TIBOR are obtained from interbank offered rates (IBORs)
Interbank offered rates (IBORs). Numerous questions have been raised on the long term viability
of benchmark on the basis of which interest are fixed. The existing accounting standards are not
fully equipped to consider the implications of benchmark interest rates. The proposed
amendments will deal with the accounting treatment in the period prior to the replacement
interest rates. Accounting treatment for hedging instruments under IFRS 9 and IAS 39 shall be
altered subsequent to the amendment coming into effects (Mates, 2009).
Changes suggested in IFRS 9 and IAS 39:
ED/2019/1- interest rate benchmark reform: