Commission Regulation (EU) 2019/2104 of 29 November 2019 amending Regulation (EC) No 1126/2008 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council as regards International Accounting Standards 1 and 8 (Text with EEA relevance) (revoked)

Paragraph 7 is amended for an entity that has adopted the 2018 Amendments to References to the Conceptual Framework in IFRS Standards, and paragraph 139T is added.

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Information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity.

Materiality depends on the nature or magnitude of information, or both. An entity assesses whether information, either individually or in combination with other information, is material in the context of its financial statements taken as a whole.

Information is obscured if it is communicated in a way that would have a similar effect for primary users of financial statements to omitting or misstating that information. The following are examples of circumstances that may result in material information being obscured:

1. (a)

   information regarding a material item, transaction or other event is disclosed in the financial statements but the language used is vague or unclear;

2. (b)

   information regarding a material item, transaction or other event is scattered throughout the financial statements;

3. (c)

   dissimilar items, transactions or other events are inappropriately aggregated;

4. (d)

   similar items, transactions or other events are inappropriately disaggregated; and

5. (e)

   the understandability of the financial statements is reduced as a result of material information being hidden by immaterial information to the extent that a primary user is unable to determine what information is material.

Assessing whether information could reasonably be expected to influence decisions made by the primary users of a specific reporting entity’s general purpose financial statements requires an entity to consider the characteristics of those users while also considering the entity’s own circumstances.

Many existing and potential investors, lenders and other creditors cannot require reporting entities to provide information directly to them and must rely on general purpose financial statements for much of the financial information they need. Consequently, they are the primary users to whom general purpose financial statements are directed. Financial statements are prepared for users who have a reasonable knowledge of business and economic activities and who review and analyse the information diligently. At times, even well-informed and diligent users may need to seek the aid of an adviser to understand information about complex economic phenomena.

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Paragraph 5 is amended for an entity that has adopted the 2018 Amendments to References to the Conceptual Framework in IFRS Standards. Paragraph 6 is deleted and paragraph 54H is added.

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Paragraph 24 is amended and paragraph 58 is added.

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Paragraph 75 is amended and paragraph 104 is added.

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