Analysis of IFRS 7 requirements for disclosure of information about financial risks in financial statements and analysis of disclosure practices. Part 1

Subject. The article addresses requirements of IFRS 7 and IFRS 9 for disclosure of information about financial risks in financial statements of an organization when market conditions change. Objectives. The aim is to disclose information about the significance of financial instruments to an organization; the nature and extent of risks arising from those financial instruments; and the impact on these risks by financial instruments. Methods. The study rests on the institutional theory of contracts, the Conceptual Framework for Financial Reporting. The latter, for the first time, recognized the need to reflect contractual rights and obligations in reporting, as an object of accounting and analysis, and became the theoretical basis for generating information about reporting of derivatives in financial statements when analyzing risks and minimizing them when using derivatives. Results. We assumed that to sufficiently and adequately meet the requirements of IFRS 7 in terms of disclosure of information about risks inherent in a business, heads of any organization should hold a number of events outlined in the article. Conclusions. The analysis of financial risks, their nature, and the degree of influence on the financial position of the reporting organization can significantly increase the transparency of financial statements for external stakeholders, strengthen their trust in the management of the organization and, as a result, contribute to making more balanced and responsible investment decisions.