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Sunday 28 May 2017

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IFRIC 17 Distributions of Non-cash Assets to Owners


IFRIC 17 Distributions of Non-cash Assets to Owners replaces D23 Distributions of Non-cash Assets to Owners.


In January 2008 the IFRIC issued a draft interpretation, IFRIC D23, for public comment. The comment period ended in April 2008. The IFRIC redeliberated the draft interpretation in light of the comments received in its  July and  September 2008 meetings.

IFRIC 17 clarifies that:

  • a dividend payable should be recognised when the dividend is appropriately authorised and is no longer at the discretion of the entity. 
  • an entity should measure the dividend payable at the fair value of the net assets to be distributed.
  • an entity should recognise the difference between the dividend paid and the carrying amount of the net assets distributed in profit or loss.

The Interpretation also requires an entity to provide additional disclosures if the net assets being held for distribution to owners meet the definition of a discontinued operation.

IFRIC 17 is available for  eIFRS subscribers or can be purchased via our shop.

Reasons for IFRIC 17

Existing International Financial Reporting Standards (IFRSs) do not address how an entity should measure distributions of assets other than cash when it pays dividends to its owners. At present the dividend payable is sometimes recognised at the carrying amount of the assets to be distributed and sometimes at their fair value. As a result significant diversity in practice has developed and the IFRIC was asked to provide guidance.


IFRIC 17 applies to pro rata distributions of non-cash assets except for common control transactions.

Effective date

Recognising the difficulty that entities would face in recognising past distributions at their fair values the IFRIC requires prospective application of the guidance. The Interpretation is effective for annual periods beginning on or after 1 July 2009. Earlier application is permitted.

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