CFM16001 - Accounting for financial instruments: IAS 32 and IAS 39: Introduction

Overview

This guidance deals with accounting for financial instruments under IAS 32 ( Financial Instruments: Disclosure and Presentation) and IAS 39 ( Financial Instruments: Recognition and Measurement). The purpose of the guidance is to give you a basic knowledge that will

• help you to understand what you see in accounts prepared in accordance with International Accounting Standards (IAS), and
• provide some background to the changes in tax legislation that are described in the "Taxing Loan Relationships" and "Taxing Derivative Contracts" sections of this manual.

It is not intended to be a comprehensive guide to the two standards. In particular, HMRC staff who encounter areas of doubt or difficulty connected with the accounting treatment of financial instruments should, as always, seek the advice of their local compliance accountant.

IAS 32 and IAS 39 have gone through a number of revisions and amendments, IAS 32 has recently become Financial Instruments: Presentation only, for example and further changes may yet occur. CFM16005 provides a What's New page, which will provide a quick overview of changes made since the original publication of this guidance.

If this guidance contains any abbreviations or technical terms that you do not understand, consult the glossary (which HMRC staff can access from the left bar).