The 2020 amendment: rights at the end of the period, not expectations

Learning objectives

• Explain what the 2020 amendment clarified about classification.L1
• Distinguish the right existing at the end of the reporting period from management's expectations.L1, L2

Normative references

The syntheses of the reference register are written in French: only the paragraph reference is shown here.

2 questions

• Under the January 2020 amendment to IAS 1, the classification of a liability as current or non-current depends on management's intention to settle it within 12 months.L1
• At 31 December 2026, Zephyr SA must repay a loan of EUR 3,000,000 in 2029 and, at the closing date, has the right to defer that settlement beyond 12 months (case facts). Its management nevertheless considers repaying early in June 2027, without being compelled to. How is the loan classified at 31 December 2026?L2