IFRS 7, “Financial Instruments: Disclosures”, requires an entity to provide disclosures in their financial statements that enable users to evaluate (a) the significance of financial instruments for the entity’s financial position and performance; and (b) the nature and extent of risks arising from financial instruments, and how the entity manages those risks.

To be compliance with the standard, an entity shall group financial instruments into classes that are appropriate to the nature of the information disclosed and that take into account the characteristics of those financial instruments.

An entity shall also provide sufficient information to facilitate reconciliation of line items presented in the statement of financial position. IFRS 7 also reminds its user about IAS 1 requires that an entity discloses, in the summary of significant accounting policies, the measurement basis (or bases) used in preparing the financial statements and the other accounting policies relevant to an understanding of the financial statements.