{
  "url": "https://openlegislation.uk/eu-regulation-2004-2086/annex-4/division-2/division-1",
  "json_url": "https://openlegislation.uk/eu-regulation-2004-2086/annex-4/division-2/division-1.json",
  "legislation": "eur/2004/2086",
  "legislation_title": "Commission Regulation (EC) No 2086/2004 of 19 November 2004 amending Regulation (EC) No 1725/2003 on the adoption of certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council as regards the insertion of IAS 39 (Text with EEA relevance)",
  "legislation_url": "https://openlegislation.uk/eu-regulation-2004-2086",
  "path": "annex/4/division/2/division/1",
  "kind": "division",
  "number": null,
  "heading": null,
  "text": "B1. IFRS 1 First-time Adoption of International Financial Reporting Standards is amended as described below.\nStandard\nParagraphs 25A, 27A, 36A and 47A are added and paragraphs 13, 27 and 30 are amended to read as follows:\n13 An entity may elect to use one or more of the following exemptions:\n(a) …\n(e) compound financial instruments (paragraph 23);\n(f) assets and liabilities of subsidiaries, associates and joint ventures (paragraphs 24 and 25);\nand\n(g) designation of previously recognised financial instruments (paragraph 25A).\nDesignation of previously recognised financial instruments\n25A IAS 39 Financial Instruments: Recognition and Measurement permits a financial instrument to be designated on initial recognition as a financial asset or financial liability at fair value through profit or loss or as available for sale. Despite this requirement, an entity is permitted to make such a designation at the date of transition to IFRSs.\n27 Except as permitted by paragraph 27A, a first-time adopter shall apply the derecognition requirements in IAS 39 prospectively for transactions occurring on or after 1 January 2004. In other words, if a first-time adopter derecognised non-derivative financial assets or non-derivative financial liabilities under its previous GAAP as a result of a transaction that occurred before 1 January 2004, it shall not recognise those assets and liabilities under IFRSs (unless they qualify for recognition as a result of a later transaction or event).\n27A Notwithstanding paragraph 27, an entity may apply the derecognition requirements in IAS 39 retrospectively from a date of the entity’s choosing, provided that the information needed to apply IAS 39 to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accounting for those transactions.\n30 If, before the date of transition to IFRSs, an entity had designated a transaction as a hedge but the hedge does not meet the conditions for hedge accounting in IAS 39 the entity shall apply paragraphs 91 and 101 of IAS 39 to discontinue hedge accounting. Transactions entered into before the date of transition to IFRSs shall not be retrospectively designated as hedges.\nExemption from the requirement to restate comparative information for IAS 39\n36A In its first IFRS financial statements, an entity that adopts IFRSs before 1 January 2006 shall present at least one year of comparative information, but this comparative information need not comply with IAS 32 and IAS 39. An entity that chooses to present comparative information that does not comply with IAS 32 and IAS 39 in its first year of transition shall:\n(a) apply its previous GAAP to financial instruments within the scope of IAS 32 and IAS 39 in the comparative information;\n(b) disclose this fact together with the basis used to prepare this information;\nand\n(c) disclose the nature of the main adjustments that would make the information comply with IAS 32 and IAS 39. The entity need not quantify those adjustments. However, the entity shall treat any adjustment between the balance sheet at the comparative period’s reporting date (ie the balance sheet that includes comparative information under previous GAAP) and the balance sheet at the start of the first IFRS reporting period (ie the first period that includes information that complies with IAS 32 and IAS 39) as arising from a change in accounting policy and give the disclosures required by paragraph 28(a)-(f) of IAS 8. Paragraph 28(f) applies only to amounts presented in the balance sheet at the comparative period’s reporting date.\nIn the case of an entity that chooses to present comparative information that does not comply with IAS 32 and IAS 39, references to the ‘date of transition to IFRSs’ shall mean, in the case of IAS 32 and IAS 39 only, the beginning of the first IFRS reporting period.\nDesignation of financial assets or financial liabilities\n43A An entity is permitted to designate a previously recognised financial asset or financial liability as a financial asset or financial liability at fair value through profit or loss or as available for sale in accordance with paragraph 25A. The entity shall disclose the fair value of any financial assets or financial liabilities designated into each category and the classification and carrying amount in the previous financial statements.",
  "extent": "E+W+S+N.I.",
  "status": null,
  "version": "current",
  "annotations": [],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/eur/2004/2086/annex/4/division/2/division/1",
    "retrieved_at": "2026-11-01T14:55:04.811990+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}