CFM21130 | Accounting for corporate finance: key concepts: examples of what are and are not financial instruments

From HM Revenue & Customs · Corporate Finance Manual

Examples of financial instruments

The definitions in CFM21060 mean that the following are financial instruments:

cash, demand and time deposits, trade accounts receivable and payable and loans of all kinds that are to be settled in cash
unconditional lease obligations
loan notes, bonds, debentures and other debt securities
warrants or options to subscribe for shares of, or purchase shares from, the issuing entity
obligations of an entity to issue or deliver shares under such warrants or options
derivative financial instruments e.g. financial options, futures and forwards, interest rate swaps and currency swaps
contingent liabilities that arise from contracts and will, if they crystallise, be settled in cash - an example is a financial guarantee.

Some of these instruments may, however, be outside the scope of IAS 32 / 39, IFRS 9 or of Sections 11 /12 of FRS 102 - see CFM21140.

Similarly, the definitions mean that the following are not financial instruments:

physical assets, such as stock, buildings, plant and equipment
intangible assets such as patents and trademarks
prepayments for goods or services
obligations to be settled by delivering goods or rendering services, such as most warranty obligations
income taxes, including deferred tax, since these are statutory rather than contractual obligations
derivatives to be settled by physical delivery
contingent items that do not arise from contracts, for example a contingent liability to pay damages if the company loses a court case
minority interests.