Tentative decisions

Financial Instruments with Characteristics of Equity — The IASB tentatively decided to require separate presentation in the statement of profit or loss of profit or loss attributable to owners of the parent, disaggregated between ordinary shareholders, participating rights holders, and non-participating rights holders.

IFRS 7 and IFRS 18 Disclosure Requirements — The IASB tentatively decided to withdraw proposed statement of financial position and changes in equity presentation requirements and instead add disclosure requirements to IFRS 7 and IFRS 18 regarding how equity instruments relate to profit or loss attribution, terms and conditions of participating instruments, and reconciliation of cumulative undeclared dividends for non-participating rights.

IFRS 7 Nature of Claims and Terms Disclosures — The IASB tentatively decided to retain proposed disclosure requirements on the nature of claims against an entity (based on reporting date, not liquidation) and terms and conditions of financial instruments, with specified scope exclusions and guidance on compound instruments and intra-group arrangements.

Maximum Dilution Disclosure — The IASB tentatively decided to require disclosure of maximum dilution of ordinary shares, including off-balance-sheet commitments, share buy-back unknowns, and illustrative examples such as exercise prices, conversion ratios, and contingent events affecting dilution.

IFRS 19 Eligible Subsidiaries — The IASB tentatively decided to add disclosure requirements for eligible subsidiaries on the presentation of equity instruments consistent with IFRS 18 amendments, with aligned nature of claims and terms and conditions disclosures.

Active projects

Financial Instruments with Characteristics of Equity — Board finalized tentative decisions on presentation and disclosure amendments across IFRS 18, IFRS 7, and IFRS 19; next step is issuance of proposed amendments for public exposure (timing decision was also addressed in Agenda Paper 5D, though details are not fully detailed in this extract).

Work Plan Update — The IASB received a general work plan status update on 18 June 2025 with no decisions required; another update is expected in three to four months.

What it means for preparers

• Profit or Loss Segregation: Finance teams must prepare to separately present and track profit or loss attributable to ordinary shareholders versus participating and non-participating rights holders in the statement of profit or loss. This requires enhanced classification of equity instruments by contractual profit or loss participation rights as at each reporting date.

• Expanded Disclosure Burden: New mandatory disclosures in IFRS 7 and IFRS 18 will require clear explanation of how equity instruments link to profit or loss attribution, detailed terms and conditions of participating instruments (including cash flow timing and uncertainty), and detailed reconciliations of cumulative undeclared dividends. Preparers should begin mapping current equity instrument terms to these disclosure categories now.

• Dilution and Subsidiary Scope: Organizations with complex capital structures, off-balance-sheet commitments (e.g., share buy-back programs, convertibles), or eligible subsidiaries must prepare comprehensive maximum dilution disclosures with illustrative detail on exercise prices, conversion ratios, and contingent triggers. This applies across both parent and subsidiary financial statements under IFRS 19.

Standards in scope

• IFRS 18 Presentation and Disclosure in Financial Statements
• IFRS 7 Financial Instruments: Disclosures
• IFRS 19 Subsidiaries without Public Accountability: Disclosures
• IAS 32 Financial Instruments: Presentation
• IAS 33 Earnings per Share