Assessment Of The Application Of Ifrs 9 Requirements By South African State-owned Entities

The global financial crisis in 2008 nearly resulted in a possible total collapse in the financial markets, which resulted in the development of new International Financial Reporting Standard (IFRS) 9: Financial Instrument. This study’s objective is to assess the quality information presented in the accounting policies in relation to IFRS 9: Financial Instruments, by the selected South African State-Owned Entities (SA SOEs) listed in Schedule 2 of the Public Finance Management Act (PFMA). The researchers have been interested in the factors of implementation and compliance of IFRS, though most of these studies are dominated by Asian and European countries with few for Africa. Using qualitative content analysis, the authors assessed the quality information in the accounting policies in relation to IFRS 9 against SOEs’ financial reporting. This study found that most of the SOEs applied the requirements of the IFRS 9 standard in terms of classification and measurement of financial assets and liabilities, though there is still room for improvement on the quality of the information provided by SOEs in their financial reports. The improvement on the quality of financial reporting is critical, as it could in turn help to build trust and confidence of investors to attract further investment.