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IFRIC 17 addresses how an entity accounts for distributions of non-cash assets to owners or distributions in which an entity gives the owner a choice of taking cash in lieu of the non-cash assets. IFRIC 17 clarifies that in both cases, the entity recognises a liability when the dividend is appropriately authorised and is no longer at the discretion of the entity.
The liability to distribute non-cash assets as a dividend is measured at the fair value of the net assets to be distributed. The liability for distributions in which the owner has a choice of taking cash in lieu is estimated by considering both the fair value of each alternative and the associated probability of selecting the alternative. In both cases, the liability is remeasured at each reporting date and at settlement, with changes recognised directly in equity.
Standard history
In November 2008 the International Accounting Standards Board issued IFRIC 17 Distributions of Non-cash Assets to Owners. It was developed by the Interpretations Committee.
The Basis for Conclusions on IFRIC 17 was amended to reflect IFRS 9 Financial Instruments (issued July 2014).
Other Standards have made minor consequential amendments to IFRIC 17. They include IFRS 10 Consolidated Financial Statements (issued May 2011), IFRS 13 Fair Value Measurement (issued May 2011) and Amendments to References to the Conceptual Framework in IFRS Standards (issued March 2018).
