Annual Improvements to IFRS Accounting Standards – Volume 11

Annual Improvements to IFRS Accounting Standards – Volume 11 (Amendments to IFRS 1, 7, 9, 10 and IAS 7) (the Amendments) were approved for adoption by all members of the UK Endorsement Board on 11 February 2025.

A link to the Adoption Statement of the Amendments and the text of the Amendments can be found here.

The Amendments are not likely to lead to a significant change in accounting practice and do not meet the criteria for a post-implementation review under Regulation 11 in SI 2019/685.

Background

The Amendments were published on 18 July 2024 and are effective for annual reporting periods beginning on or after 1 January 2026, with early application permitted.

The Amendments are a collection of six separate amendments to the mandatory sections of five IFRS Accounting Standards:

• IFRS 9 Financial Instrument - Transaction price. The amendment deletes the reference to ‘transaction price’ and revises the wording around it in paragraph 5.1.3; and removes the reference to IFRS 15 in Appendix A.
• IFRS 9 Financial Instrument - Lessee derecognition of lease liabilities. The amendment clarifies a lessee’s accounting for derecognition of a lease liability by adding a cross-reference to paragraph 3.3.3 of IFRS 9 in paragraph 2.1(b)(ii) of IFRS 9.
• IFRS 7 Financial Instruments: Disclosures - Gain or loss on derecognition. The amendment replaces the reference to paragraph 27A of IFRS 7, a paragraph that no longer exists, with a reference to paragraphs 72–73 of IFRS 13; and replaces the phrase ‘inputs that were not based on observable market data’ with ‘unobservable inputs’.
• IFRS 1 First-time Adoption of International Financial Reporting Standards - Hedge accounting by a first-time adopter. The amendment replaces the word ‘conditions’ with ‘qualifying criteria’ and adds cross-references to paragraph 6.4.1 of IFRS 9 in paragraphs B5–B6 of IFRS 1. This is to ensure consistency with the wording in IFRS 9.
• IFRS 10 Consolidated Financial Statement - Determination of a ‘de facto’ agent. The amendment clarifies the requirements in paragraph B74 of IFRS 10.
• IAS 7 Statement of Cash Flows - Cost method. The amendment replaces the term ‘cost method’, a term that is no longer defined in IFRS Accounting Standards, with ‘at cost’ in paragraph 37 of IAS 7.

The UKEB actively influenced the development of these amendments. Refer to work performed as part of the ‘Influencing Project’.

UKEB Endorsement Criteria Assessment

On 18 October 2024 the UKEB published its Draft Endorsement Criteria Assessment (DECA) on Annual Improvements to IFRS Accounting Standards – Volume 11.

The public consultation period closed on 17 January 2025. Thank you to all stakeholders that provided feedback.

All responses received were considered when finalising the Endorsement Criteria Assessment (ECA). The final ECA was published on 13 February 2025. An accompanying Feedback Statement, describing how feedback received from stakeholders was addressed, was also published on the same date.

The relevant documents are available at the foot of this page:

• Project Initiation Plan
• DECA and Invitation to Comment
• Response from stakeholders
• Final ECA
• Feedback Statement
• Due Process Compliance Statement (DPCS) (will be available after UKEB’s February 2025 Board meeting)

UKEB Outreach

The UKEB outreach plan includes a public consultation on the UKEB’s Draft Endorsement Assessment Criteria (DECA).

UKEB meetings

The Amendments were discussed in the following UKEB meetings:

• Project Initiation Plan - 17 October 2024
• Draft Endorsement Criteria Assessment - 17 October 2024
• Adoption package ([draft] Endorsement Criteria Assessment (ECA), Feedback Statement, [draft] Due Process Compliance Statement, Adoption statement) – 30 January 2025

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