The European Union’s Endorsement of Amendments to International Financial Reporting Standard 4: An Unprecedented ‘Top Up’
In: Journal of Corporate Accounting & Finance, early view: DOI/10.1002/jcaf.22436 (December 9, 2019)
7 Pages Posted: 9 Feb 2020
Date Written: December 9, 2019
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.
Keywords: carve-in, European Union (EU), financial conglomerate, financial instruments, insurance, international accounting, International Financial Reporting Standards (IFRS), top up
JEL Classification: M41, M48, G22, G23
Suggested Citation: Suggested Citation