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The European Union's endorsement of Amendments to International Financial Reporting Standard 4: An unprecedented “top up”
Author(s) -
Dobler Michael
Publication year - 2020
Publication title -
journal of corporate accounting and finance
Language(s) - English
Resource type - Journals
eISSN - 1097-0053
pISSN - 1044-8136
DOI - 10.1002/jcaf.22436
Subject(s) - european union , accounting , business , international financial reporting standards , member states , finance , international trade
The International Financial Reporting Standards (IFRS) must pass a formal endorsement process to become binding for companies based in the European Union (EU). In an unparalleled instance, the EU recently endorsed “Amendments to IFRS 4” with a modification labeled as “top up” by allowing European financial conglomerates to defer the application of IFRS 9 “Financial Instruments” in their insurance sectors. This paper explains the background of this decision, identifies the “top up” as an unprecedented case of carve‐in, and discusses the key implications for regulation and practice.