ipsas 29—financial instruments: recognition and measurement - IFAC

FINANCIAL INSTRUMENTS: RECOGNITION AND MEASUREMENT
the date of the transfer. For this purpose, the requirements of paragraph 30
apply. The difference between:
(a) The carrying amount allocated to the part that is no longer
recognized; and
(b) The sum of (i) the consideration received for the part no longer
recognized and (ii) any cumulative gain or loss allocated to it that had
been recognized directly in net assets/equity (see paragraph 64(b));
shall be recognized in surplus or deficit. A cumulative gain or loss that had
been recognized in net assets/equity is allocated between the part that
continues to be recognized and the part that is no longer recognized on the
basis of the relative fair values of those parts.
37. If the transferred asset is measured at amortized cost, the option in this
Standard to designate a financial liability as at fair value through surplus or
deficit is not applicable to the associated liability.
All Transfers
38. If a transferred asset continues to be recognized, the asset and the associated
liability shall not be offset. Similarly, the entity shall not offset any revenue
arising from the transferred asset with any expense incurred on the
associated liability (see IPSAS 28 paragraph 47).
39. If a transferor provides non-cash collateral (such as debt or equity
instruments) to the transferee, the accounting for the collateral by the
transferor and the transferee depends on whether the transferee has the
right to sell or repledge the collateral and on whether the transferor has
defaulted. The transferor and transferee shall account for the collateral as
follows:
(a) If the transferee has the right by contract or custom to sell or repledge
the collateral, then the transferor shall reclassify that asset in its
statement of financial position (e.g., as a loaned asset, pledged equity
instruments or repurchase receivable) separately from other assets.
(b) If the transferee sells collateral pledged to it, it shall recognize the
proceeds from the sale and a liability measured at fair value for its
obligation to return the collateral.
(c) If the transferor defaults under the terms of the contract and is no
longer entitled to redeem the collateral, it shall derecognize the
collateral, and the transferee shall recognize the collateral as its asset
initially measured at fair value or, if it has already sold the collateral,
derecognize its obligation to return the collateral.
1045
IPSAS 29
PUBLIC SECTOR