{
  "url": "https://openlegislation.uk/eu-regulation-2006-108/annex/appendix-C",
  "json_url": "https://openlegislation.uk/eu-regulation-2006-108/annex/appendix-C.json",
  "legislation": "eur/2006/108",
  "legislation_title": "Commission Regulation (EC) No 108/2006 of 11 January 2006 amending Regulation (EC) No 1725/2003 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council as regards International Financial Reporting Standards (IFRS) 1, 4, 6 and 7, International Accounting Standards (IAS) 1, 14, 17, 32, 33, and 39, International Financial Reporting Interpretations Committee's (IFRIC) Interpretation 6 (Text with EEA relevance)",
  "legislation_url": "https://openlegislation.uk/eu-regulation-2006-108",
  "path": "annex/appendix/C",
  "kind": "appendix",
  "number": "C",
  "heading": "Amendments to other IFRSs",
  "text": "The amendments in this appendix shall be applied for annual periods beginning on or after 1 January 2007. If an entity applies the IFRS for an earlier period, these amendments shall be applied for that earlier period. In the amended paragraphs, new text is underlined and deleted text is struck through.\nC1 In International Financial Reporting Standards, including International Accounting Standards and Interpretations, references to IAS 32 Financial Instruments: Disclosure and Presentation are replaced by references to IAS 32 Financial Instruments: Presentation, unless otherwise stated below.\nC2 IAS 32 Financial Instruments: Disclosure and Presentation (as revised in 2003) is amended as described below.\nThe title is amended to ‘IAS 32 Financial Instruments: Presentation’.\nParagraph 1 is deleted and paragraphs 2-4(a) are amended as follows:\n2.. The objective of this Standard is to establish principles for presenting financial instruments as liabilities or equity and for offsetting financial assets and financial liabilities. It applies to the classification of financial instruments, from the perspective of the issuer, into financial assets, financial liabilities and equity instruments; the classification of related interest, dividends, losses and gains; and the circumstances in which financial assets and financial liabilities should be offset.\n3.. The principles in this Standard complement the principles for recognising and measuring financial assets and financial liabilities in IAS 39 Financial Instruments: Recognition and Measurement, and for disclosing information about them in IFRS 7 Financial Instruments: Disclosures.\nSCOPE\n4.. This Standard shall be applied by all entities to all types of financial instruments except:\n(a) those interests in subsidiaries, associates and joint ventures that are accounted for in accordance with IAS 27 Consolidated and Separate Financial Statements, IAS 28 Investments in Associates or IAS 31 Interests in Joint Ventures. However, in some cases, IAS 27, IAS 28 or IAS 31 permits an entity to account for an interest in a subsidiary, associate or joint venture using IAS 39; in those cases, entities shall apply the disclosure requirements in IAS 27, IAS 28 or IAS 31 in addition to those in this Standard. Entities shall also apply this Standard to all derivatives linked to interests in subsidiaries, associates or joint ventures.\nParagraphs 5 and 7 are deleted.\nThe second sentence of paragraph 40 is amended as follows:\n40.. … In addition to the requirements of this Standard, disclosure of interest and dividends is subject to the requirements of IAS 1 and IFRS 7.\nThe last sentence of paragraph 47 is amended as follows:\n47.. … When an entity has a right of set-off, but does not intend to settle net or to realise the asset and settle the liability simultaneously, the effect of the right on the entity’s credit risk exposure is disclosed in accordance with paragraph 36 of IFRS 7.\nThe last sentence of paragraph 50 is amended as follows:\n50.. … When financial assets and financial liabilities subject to a master netting arrangement are not offset, the effect of the arrangement on an entity’s exposure to credit risk is disclosed in accordance with paragraph 36 of IFRS 7.\nParagraphs 51-95 are deleted.\nParagraph 98 is footnoted as follows:\nIn August 2005 the IASB relocated all disclosures relating to financial instruments to IFRS 7 Financial Instruments: Disclosures.\nIn the Appendix (Application Guidance), paragraphs AG24 and AG40 and the last sentence of paragraph AG39 are deleted.\nC3 IAS 1 Presentation of Financial Statements is amended as described below.\nParagraph 4 is deleted.\nIn paragraph 56, ‘IAS 32’ is replaced by ‘IFRS 7 Financial Instruments: Disclosures’, and in paragraphs 105(d)(ii) and 124, ‘IAS 32’ is replaced by ‘IFRS 7’.\nThe last sentence of paragraph 71(b) is amended as follows:\n71(b) … For example, a financial institution may amend the above descriptions to provide information that is relevant to the operations of a financial institution.\nThe fourth sentence of paragraph 84 is amended as follows:\n84.. … For example, a financial institution may amend the descriptions to provide information that is relevant to the operations of a financial institution.\nC4 IAS 14 Segment Reporting is amended as described below.\nIn paragraphs 27(a) and (b), 31, 32, 46 and 74, the phrase ‘the board of directors and [to] [the] chief executive officer’ is replaced by ‘key management personnel’.\nIn paragraphs 27(b), 30 and 32 the phrase ‘the directors and management’ is replaced by ‘key management personnel’.\nThe first sentence of paragraph 27 is amended as follows:\n27.. An entity’s internal organisational and management structure and its system of internal financial reporting to key management personnel (for example, the board of directors and the chief executive officer) shall normally be the basis for identifying the predominant source and nature of risks and differing rates of return facing the entity and, therefore, for determining which reporting format is primary and which is secondary, except as provided in subparagraphs (a) and (b) below: …\nThe third sentence of paragraph 28 is amended as follows:\n28.. … Therefore, except in rare circumstances, an entity will report segment information in its financial statements on the same basis as it reports internally to key management personnel. …\nThe first sentence of paragraph 33 is amended as follows:\n33.. Under this Standard, most entities will identify their business and geographical segments as the organisational units for which information is reported to key management personnel or the senior operating decision maker, which in some cases may be a group of people, for the purpose of evaluating each unit’s past performance and for making decisions about future allocations of resources. …\nC5 In paragraph 31 of IAS 17 Leases, ‘IAS 32 Financial Instruments: Disclosure and Presentation’ is replaced by ‘IFRS 7 Financial Instruments: Disclosures’, and in paragraphs 35, 47 and 56, ‘IAS 32’ is replaced by ‘IFRS 7’.\nC6 In paragraph 72 of IAS 33 Earnings per Share, ‘IAS 32’ is replaced by ‘IFRS 7 Financial Instruments: Disclosures’.\nC7 IAS 39 Financial Instruments: Recognition and Measurement (as amended in April 2005) is amended as described below.\nParagraph 1 is amended as follows:\n1.. The objective of this Standard is to establish principles for recognising and measuring financial assets, financial liabilities and some contracts to buy or sell non-financial items. Requirements for presenting information about financial instruments are in IAS 32 Financial Instruments: Presentation. Requirements for disclosing information about financial instruments are in IFRS 7 Financial Instruments: Disclosures.\nIn paragraph 45, ‘IAS 32’ is replaced by ‘IFRS 7’.\nParagraph 48 is amended as follows:\n48.. In determining the fair value of a financial asset or a financial liability for the purpose of applying this Standard, IAS 32 or IFRS 7, an entity shall apply paragraphs AG69-AG82 of Appendix A.\nC8 IAS 39 Financial Instruments: Recognition and Measurement (as amended in June 2005) is amended as described below.\nIn paragraph 9, the definition of a financial asset or financial liability at fair value through profit or loss is amended as follows:\n… In IFRS 7, paragraphs 9-11 and B4 require the entity to provide disclosures about financial assets and financial liabilities it has designated as at fair value through profit or loss, …\nC9 In IFRS 1 First-time Adoption of International Financial Reporting Standards, paragraph 36A is amended, and a heading and paragraph 36C are added as follows:\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, IAS 39 or IFRS 4. An entity that chooses to present comparative information that does not comply with IAS 32, IAS 39 or IFRS 4 in its first year of transition shall:\n(a) apply the recognition and measurement requirements of its previous GAAP in the comparative information for financial instruments within the scope of IAS 32 and IAS 39 and for insurance contracts within the scope of IFRS 4;\n…\nIn the case of an entity that chooses to present comparative information that does not comply with IAS 32, IAS 39 and IFRS 4, references to the ‘date of transition to IFRSs’ shall mean, in the case of those Standards only, the beginning of the first IFRS reporting period. Such entities are required to comply with paragraph 15(c) of IAS 1 to provide additional disclosures when compliance with the specific requirements in IFRSs is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity’s financial position and financial performance.\nExemption from the requirement to provide comparative disclosures for IFRS 7\n36C An entity that adopts IFRSs before 1 January 2006 and chooses to adopt IFRS 7 Financial Instruments: Disclosures in its first IFRS financial statements need not present the comparative disclosures required by IFRS 7 in those financial statements.\nC10 IFRS 4 Insurance Contracts is amended as described below.\nParagraph 2(b) is amended as follows:\n(b) financial instruments that it issues with a discretionary participation feature (see paragraph 35). IFRS 7 Financial Instruments: Disclosures requires disclosure about financial instruments, including financial instruments that contain such features.\nParagraph 35(d) is added as follows:\n(d) although these contracts are financial instruments, an issuer applying paragraph 19(b) of IFRS 7 to contracts with a discretionary participation feature shall disclose the total interest expense recognised in profit or loss, but need not calculate such interest expense using the effective interest method.\nAfter paragraph 37, the heading and paragraphs 38 and 39 are amended and paragraph 39A is added as follows:\nNature and extent of risks arising from insurance contracts\n38. An insurer shall disclose information that enables users of its financial statements to evaluate the nature and extent of risks arising from insurance contracts.\n39. To comply with paragraph 38, an insurer shall disclose:\n(a) its objectives, policies and processes for managing risks arising from insurance contracts and the methods used to manage those risks.\n(b) [deleted]\n(c) information about insurance risk (both before and after risk mitigation by reinsurance), including information about:\n(i) sensitivity to insurance risk (see paragraph 39A).\n(ii) concentrations of insurance risk, including a description of how management determines concentrations and a description of the shared characteristic that identifies each concentration (eg type of insured event, geographical area, or currency).\n(iii) actual claims compared with previous estimates (ie claims development). The disclosure about claims development shall go back to the period when the earliest material claim arose for which there is still uncertainty about the amount and timing of the claims payments, but need not go back more than ten years. An insurer need not disclose this information for claims for which uncertainty about the amount and timing of claims payments is typically resolved within one year.\n(d) information about credit risk, liquidity risk and market risk that paragraphs 31-42 of IFRS 7 would require if the insurance contracts were within the scope of IFRS 7. However:\n(i) an insurer need not provide the maturity analysis required by paragraph 39(a) of IFRS 7 if it discloses information about the estimated timing of the net cash outflows resulting from recognised insurance liabilities instead. This may take the form of an analysis, by estimated timing, of the amounts recognised in the balance sheet.\n(ii) if an insurer uses an alternative method to manage sensitivity to market conditions, such as an embedded value analysis, it may use that sensitivity analysis to meet the requirement in paragraph 40(a) of IFRS 7. Such an insurer shall also provide the disclosures required by paragraph 41 of IFRS 7.\n(e) information about exposures to market risk arising from embedded derivatives contained in a host insurance contract if the insurer is not required to, and does not, measure the embedded derivatives at fair value.\n39A To comply with paragraph 39(b)(i), an insurer shall disclose either (a) or (b) as follows:\n(a) a sensitivity analysis that shows how profit or loss and equity would have been affected had changes in the relevant risk variable that were reasonably possible at the balance sheet date occurred; the methods and assumptions used in preparing the sensitivity analysis; and any changes from the previous period in the methods and assumptions used. However, if an insurer uses an alternative method to manage sensitivity to market conditions, such as an embedded value analysis, it may meet this requirement by disclosing that alternative sensitivity analysis and the disclosures required by paragraph 41 of IFRS 7.\n(b) qualitative information about sensitivity, and information about those terms and conditions of insurance contracts that have a material effect on the amount, timing and uncertainty of the insurer’s future cash flows.",
  "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/2006/108/annex/appendix/C",
    "retrieved_at": "2026-11-01T14:53:58.207860+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."
}