IFRS 19: reduced disclosures for subsidiaries

What is IFRS 19 for?

A subsidiary reporting to its parent under IFRS often prepares its own statutory accounts under local GAAP or the IFRS for SMEs Accounting Standard, because full IFRS disclosures are costly and of limited use to its few outside users. That means two sets of records. IFRS 19 lets the subsidiary use the same IFRS recognition and measurement as the group with a reduced set of disclosures, so one set of numbers serves both purposes. It is a disclosure standard only: nothing about how amounts are measured changes. See control and subsidiaries under IFRS 10.

Who can apply IFRS 19?

The test is applied at the end of each reporting period. A subsidiary has public accountability if its debt or equity instruments are traded in a public market, or it is in the process of issuing them, or if it holds assets in a fiduciary capacity for a broad group of outsiders as one of its primary businesses. Banks, credit unions, insurers, securities brokers and dealers, mutual funds and investment banks usually meet the second test. The parent publishing IFRS consolidated statements can be the ultimate parent or an intermediate one.

IFRS 19 in practice: which subsidiaries are eligible subsidiaries?

A group headed by a company that publishes IFRS consolidated financial statements has five subsidiaries.

2 subsidiaries can choose IFRS 19. Beta and Gamma fail the public accountability test, and Epsilon fails because no parent above it publishes IFRS consolidated statements. Delta can apply IFRS 19 in its own consolidated statements because the ultimate parent publishes IFRS consolidated statements, and its own published statements would also make any subsidiaries below it eligible. Each eligible subsidiary decides for itself, and the choice does not depend on what the others do.

What changes in the financial statements?

• Recognition, measurement and presentation stay exactly as under full IFRS, including IFRS 18 from 2027.
• Disclosures follow IFRS 19, which sets out a reduced list standard by standard in place of the requirements in the other standards. The IASB built the list on the principles behind the IFRS for SMEs Accounting Standard: information on short-term cash flows, obligations and commitments, liquidity and solvency, measurement uncertainty and accounting policy choices.
• Exceptions: a subsidiary that applies IFRS 8 Operating Segments, IAS 33 Earnings per Share or IFRS 17 Insurance Contracts gives all of their disclosures. See IFRS 8 operating segments and IAS 33 earnings per share.
• Statement of compliance: the notes must state explicitly and without reservation that the statements comply with IFRS Accounting Standards and that IFRS 19 has been applied.
• Choice: a subsidiary may revoke its election in a later period and elect again afterwards; the IAS 8 rules on changes in accounting policy do not apply to these decisions.

Disclosures that matter most for subsidiaries, such as related party transactions, remain in the reduced set. See IAS 24 related party disclosures.

What did the 2025 amendments to IFRS 19 add?

IFRS 19, issued in May 2024, covered standards issued up to February 2021. Amendments issued on 21 August 2025 completed the catch-up by adding reduced disclosures for:

• IFRS 18 Presentation and Disclosure in Financial Statements;
• supplier finance arrangements (amendments to IAS 7 and IFRS 7);
• the Pillar Two model rules (amendments to IAS 12);
• lack of exchangeability (amendments to IAS 21); and
• the classification and measurement of financial instruments (amendments to IFRS 9 and IFRS 7).

From now on the IASB will amend IFRS 19 at the same time as it issues or revises other standards. See IFRS 18 explained.

When does IFRS 19 apply?

For annual periods beginning on or after 1 January 2027, the same date as IFRS 18, with earlier application permitted where the standard has been adopted locally, for example by EU endorsement or UK adoption. A subsidiary moving from local GAAP to IFRS with IFRS 19 also applies IFRS 1. See IFRS 1 first-time adoption.

How does IFRS 19 compare with the alternatives?

The IFRS for SMEs Accounting Standard also has fewer disclosures, but it simplifies recognition and measurement too, so the numbers differ from the group's. In the UK, FRS 101 offers reduced disclosures on IFRS numbers, but statements under it are not described as complying with IFRS. US GAAP has no reduced-disclosure standard for subsidiaries: private companies instead use the Private Company Council's accounting alternatives and the disclosure relief written into individual topics. See IFRS vs US GAAP key differences.

This guide is general information. It is not tax or legal advice for your situation.