05/04/2023 - EFRAG's Endorsement Advice On Amendments to IAS 1

​​The IASB issued the following amendments to IAS 1, collectively "the Amendments": 

• Classification of Liabilities as Current or Non-current (January 2020);  
• Classification of Liabilities as Current or Non-current - Deferral of Effective Date (July 2020); and 
• Presentation of Financial Statements: Non-current Liabilities with Covenants (October 2022).  
  

The objective of the Amendments is to clarify the principles in IAS 1 Presentation of Financial Statements for the classification of liabilities as either current or non-current. The Amendments mainly clarify the notion of settlement, specify how an entity classifies a liability arising from a loan arrangement with covenants as current or non-current, and regulate the disclosures to be provided when an entity has loan arrangements with covenants that could require the loan arrangement to become payable within twelve months after the reporting period. 

EFRAG has submitted its Endorsement Advice relating to the Amendments for use in the European Union and European Economic Area. EFRAG assesses that the Amendments meet the technical endorsement criteria of the IAS Regulation and is conducive to the Euro​​​pean public good. EFRAG therefore recommends its endorsement. EFRAG's recommendation can be found in the letter to the European Commission and the accompanying appendices. 

The ​​Endorsement Advice Letter to the European Commission can be found here.  

EFRAG has also updated its Endorsement Status Report, which can be found  here on EFRAG's web page.​​​