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IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments


The IFRIC published in August 2009 an invitation to comment on a draft interpretation relating to transactions where equity instruments are issued to extinguish financial liabilities. IFRIC 19 provided guidance on how an issuer of debt should account for a debt for equity swap; in other words, when a debtor and creditor renegotiate the terms of a financial liability with the result that the liability is fully or partially extinguished by the debtor issuing equity instruments to the creditor.
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