Abstract
This limited scope dissertation assesses whether banks registered in terms of the Banks Act no. 94 of South Africa (South Africa, 1990) are classifying financial instruments into their appropriate fair value hierarchy level, as well as the extent to which they are complying with the disclosure requirements of IFRS 13. Ten banks were selected for the study. The financial statements for the first reporting period beginning on or after 1 January 2015 financial year were analysed to assess the appropriateness of their classifications of their financial instruments as well as compliance with the disclosure requirements of IFRS 13. In order to determine the appropriateness of the level in which financial instruments are classified, the valuation approaches and inputs disclosed in the financial statements were assessed to determine whether the hierarchy in which the financial instruments are classified is appropriate. The results indicate that certain corporate debt securities and derivatives are being classified as Level 1 rather than Level 2, while some unlisted equities for which the inputs used in the valuation entailed the use of significant unobservable inputs were classified as Level 2 instead of Level 3. In order to determine the extent of compliance with the disclosure requirements of IFRS 13, the disclosures were assessed using a self-constructed index checklist based on the disclosures listed in IFRS 13...
M.Com. (International Accounting)