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Commission Regulation (EU) No 1256/2012 of 13 December 2012 amending Regulation (EC) No 1126/2008 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council as regards International Financial Reporting Standard 7 and International Accounting Standard 32 (Text with EEA relevance)
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THE EUROPEAN COMMISSION,
Having regard to the Treaty on the Functioning of the European Union,
Having regard to Regulation (EC) No 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards(1), and in particular Article 3(1) thereof,
Whereas:
(1) By Commission Regulation (EC) No 1126/2008(2) certain international standards and interpretations that were in existence at 15 October 2008 were adopted.
(2) On 16 December 2011, the International Accounting Standards Board (IASB) published amendments to International Financial Reporting Standard (IFRS) 7 Financial Instruments: Disclosures –Offsetting Financial Assets and Financial Liabilities and to International Accounting Standard (IAS) 32 Financial Instruments: Presentation - Offsetting Financial Assets and Financial Liabilities. The amendment to IFRS 7 aims to require the provision of additional quantitative information in order to allow the users to better compare and reconcile the disclosures under IFRS and the Generally Accepted Accounting Principles (GAAP) of the United States. In addition, the IASB amended IAS 32 to provide additional guidance to reduce inconsistent application of the standard in practice.
(3) The amendments to IFRS 7 Financial Instruments: Disclosures – Transfers of Financial Assets were adopted by Commission Regulation (EU) No 1205/2011 of 22 November 2011 amending Regulation (EC) No 1126/2008 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council as regards International Financial Reporting Standard (IFRS) 7(3) after being approved by the Accounting Regulatory Committee in June 2011. However, the deletion of paragraph 13 of IFRS 7 was inadvertently omitted. This Regulation should remedy this omission. In order for this provision to be efficient, it should apply from 1 July 2011. The provision of retroactivity is necessary with the view to ensure legal certainty for the issuers concerned.
(4) The consultation with the Technical Expert Group (TEG) of the European Financial Reporting Advisory Group (EFRAG) confirms that the amendments to IFRS 7 and IAS 32 meet the technical criteria for adoption set out in Article 3(2) of Regulation (EC) No 1606/2002.
(5) Regulation (EC) No 1126/2008 should therefore be amended accordingly.
(6) The measures provided for in this Regulation are in accordance with the opinion of the Accounting Regulatory Committee,
HAS ADOPTED THIS REGULATION:
The Annex to Regulation (EC) No 1126/2008 is amended as follows:
International Financial Reporting Standard (IFRS) 7 Financial Instruments: Disclosures is amended as set out in the Annex to this Regulation;
International Accounting Standard (IAS) 32 Financial Instruments: Presentation is amended in accordance with the amendments to IFRS 7 as set out in the Annex to this Regulation;
IAS 32 Financial Instruments: Presentation is amended as set out in the Annex to this Regulation;
The heading before paragraph 13 and paragraph 13 of IFRS 7 are deleted in accordance with the amendments to IFRS 7 Financial Instruments: Disclosures –Transfers of Financial Assets as adopted by Regulation (EU) No 1205/2011.
1.Each company shall apply the amendments referred to in points (1) and (2) of Article 1 as from the commencement date of its first financial year starting on or after 1 January 2013.
2.Each company shall apply the amendments referred to in point (3) of Article 1, at the latest, as from the commencement date of its first financial year starting on or after 1 January 2014.
3.Each company shall apply the amendments referred to in point (4) of Article 1 as from the commencement date of its first financial year starting on or after 1 July 2011.
This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Union.
This Regulation shall be binding in its entirety and directly applicable in all Member States.
Done at Brussels, 13 December 2012.
For the Commission
The President
José Manuel Barroso
IFRS 7 | Amendments to IFRS 7 Financial Instruments: Disclosures – Offsetting Financial Assets and Financial Liabilities |
IAS 32 | Amendments to IAS 32 Financial Instruments: Presentation – Offsetting Financial Assets and Financial Liabilities |
"Reproduction allowed within the European Economic Area. All existing rights reserved outside the EEA, with the exception of the right to reproduce for the purposes of personal use or other fair dealing. Further information can be obtained from the IASB at www.iasb.org"
After paragraph 13, a heading and paragraphs 13A–13F are added.
the gross amounts of those recognised financial assets and recognised financial liabilities;
the amounts that are set off in accordance with the criteria in paragraph 42 of IAS 32 when determining the net amounts presented in the statement of financial position;
the net amounts presented in the statement of financial position;
the amounts subject to an enforceable master netting arrangement or similar agreement that are not otherwise included in paragraph 13C(b), including:
amounts related to recognised financial instruments that do not meet some or all of the offsetting criteria in paragraph 42 of IAS 32; and
amounts related to financial collateral (including cash collateral); and
the net amount after deducting the amounts in (d) from the amounts in (c) above.
The information required by this paragraph shall be presented in a tabular format, separately for financial assets and financial liabilities, unless another format is more appropriate.
Paragraph 44R is added.
After paragraph B39, headings and paragraphs B40–B53 are added.
Paragraph 43 is amended.
Paragraph 97L is added.
Immediately after the heading ‘Offsetting a financial asset and a financial liability (paragraphs 42–50)’, paragraph AG38 is deleted. Headings and paragraphs AG38A–AG38F are added.
must not be contingent on a future event; and
must be legally enforceable in all of the following circumstances:
the normal course of business;
the event of default; and
the event of insolvency or bankruptcy
of the entity and all of the counterparties.
financial assets and financial liabilities eligible for set-off are submitted at the same point in time for processing;
once the financial assets and financial liabilities are submitted for processing, the parties are committed to fulfil the settlement obligation;
there is no potential for the cash flows arising from the assets and liabilities to change once they have been submitted for processing (unless the processing fails—see (d) below);
assets and liabilities that are collateralised with securities will be settled on a securities transfer or similar system (for example, delivery versus payment), so that if the transfer of securities fails, the processing of the related receivable or payable for which the securities are collateral will also fail (and vice versa);
any transactions that fail, as outlined in (d), will be re-entered for processing until they are settled;
settlement is carried out through the same settlement institution (for example, a settlement bank, a central bank or a central securities depository); and
an intraday credit facility is in place that will provide sufficient overdraft amounts to enable the processing of payments at the settlement date for each of the parties, and it is virtually certain that the intraday credit facility will be honoured if called upon.
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