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IFRS 7 Financial Instruments: Disclosures

IFRS 7 Financial Instruments: Disclosures was issued by International Accounting Standards Board (IASB) in 2005 and has been effective since January 1, 2007. IFRS 7 replaced IAS 30 Disclosures in the Financial Statements and Similar Financial Institutions and the disclosure requirements in IAS 32 Financial instruments: Disclosure and Presentation.

IFRS 7 requires an entity to provide disclosures about the significance of financial instruments for its financial position and performance. IFRS 7 requires disclosure of:

  • the significance of financial instruments for an entity's financial position and performance. These disclosures incorporate many of the requirements previously in IAS 32.
  • qualitative and quantitative information about exposure to risks arising from financial instruments, including specified minimum disclosures about credit risk, liquidity risk and market risk. The qualitative disclosures describe management's objectives, policies and processes for managing those risks. The quantitative disclosures provide information about the extent to which the entity is exposed to risk, based on information provided internally to the entity's key management personnel. Together, these disclosures provide an overview of the entity's use of financial instruments and the exposures to risks they create.

IFRS 7 applies to all risks arising from all financial instruments, except those covered by another more specific standard such as interests in subsidiaries, associates and joint venture, post-employment benefits, share-based payment and insurance contracts. Although IFRS 7 applies to all entities, the extent of disclosure required depends on the extent of the entity's use of financial instruments and of its exposure to risk.


We hope that this information will assist you, but it should not be used or relied upon as a substitute for your own independent research. For a more comprehensive view of the standards/requirements, please visit the respective issuer's website.