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IAS 1 - Deferral of Effective Date - Classification of Liabilities


On 10 February 2015, the IASB published ED/2005/1 Classification of Liabilities and requested comments by 10 June 2015. The proposed amendments were designed to improve prese​n​tation in financial statements by clarifying the criteria for the classification of a liability as either current or non-current. The proposed amendments intend to:
  • clarify that the classification of a liability as either current or non-current is based on the entity’s rights at the end of the reporting period; and
  • make clear the link between the settlement of the liability and the outflow of resources from the entity.
In January 2020 the IASB issued Classification of Liabilities as Current or Non-current, which amended IAS 1  Presentation of Financial Statements​ with an effective date of annual reporting period beginning on or after 1 January 2022, The amendments of IAS 1 can be found in the Project: IAS 1 Amendments- Classification of Liabilities as Current or Non-current. However, due to the covid-19 pandemic, the IASB proposed to defer the effective date by one year, until 1 January 2023, to provide companies with more time to implement any classification changes resulting from the amendments.
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