FRS 25 (IAS 32) Financial Instruments: Presentation
Issued December 2004. Effective 1 January 2005 for listed entities. Unlisted entities using fair value measures must comply with FRS 24 from 1 January 2006.
FRS 25 has been superseded by FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland for accounting periods beginning on or after 1 January 2015. For more information visit:
Synopsis
FRS 25 is equivalent to IAS 32. It classifies financial instruments into:
- Financial assets
- Financial liabilities
- Equity
in accordance with the substance of the arrangement and the definitions of these elements. In certain cases, such as convertible debt, the instrument is split into a liability and equity element. Financial assets and liabilities may only be offset where there is a legally enforceable right to offset and the entity intends to settle on a net basis. Any treasury shares are deducted from equity.
Interest, dividends, losses and gains related to a financial liability are recognised in profit or loss; dividends in relation to equity instruments are recognised directly in equity.
Last updated 21 June 2015