The European Securities and Markets Authority (ESMA) has formally requested the IFRS Interpretation Committee to clarify the accounting treatment of sales of equity instruments measured at fair value through other comprehensive income (FVOCI) under IFRS 9, specifically when the consideration received differs from the fair value at the time of sale. The request, contained in a letter dated 29 June 2026, seeks guidance on how to recognise the difference between the sale proceeds and the fair value, and whether any amounts previously recognised in other comprehensive income should be reclassified to profit or loss.
ESMA's letter, addressed to the IFRS Interpretation Committee, highlights a lack of clarity in the current IFRS 9 requirements for such transactions. The agency notes that divergent practices may arise among entities applying IFRS 9, potentially undermining comparability of financial statements. The request focuses on the interaction between the derecognition of the equity instrument and the recognition of the sale proceeds, particularly when the transaction price is not at fair value. ESMA asks the Committee to provide interpretative guidance on whether the difference should be recognised immediately in profit or loss or treated as an adjustment to the cost of the investment.
The letter does not propose a specific accounting treatment but outlines the issue and requests the Committee to consider the matter as a priority. ESMA's intervention reflects its role in promoting consistent application of IFRS within the European Union, where IFRS 9 is mandatory for listed companies. The request may affect preparers of financial statements, auditors, and investors who rely on transparent and comparable reporting of equity investments. No specific timeline for the Committee's response has been indicated.