The accounting of financial instruments is one of the most complex areas that often presents users with enormous challenges. Furthermore, the recognition and measurement of financial assets and liabilities under IAS 39 and IAS 32 are of fundamental importance in a global business environment. The authors convey a systematic and detailed approach that facilitates the understanding of the exception-laden IAS 39. Based on a solid and current scientific foundation and in line with the IFRS commentary, this work provides a precise overview of the accounting regulations for financial instruments.