The purpose of K-IFRS is to express economic substance of firm as faithfully so the introduction of K-IFRS will extend the fair value of financial instruments. Fair value of financial instruments is useful information to evaluate the achievements of executive officer to acquire and hold the financial instruments. In addition, the fair value information provide size of future cash flows, time and uncertainties about financial assets, so fair value information can explain the intrinsic value of financial instruments better than other information. Therefore, unrealized gains on financial instruments can be very important information. Based on the situation of fair value in financial institutions, available-for-sale securities are low proportion compared to asset but gain on disposal of available-for-sale securities are high proportion compared to net income. So executive officer conducts earnings management by available-for-sale securities and the advantages of fair value may be impaired. In this study, We analyze whether K-IFRS 1109 can prevent earnings management compared with K-IFRS 1039 based on the representative of the domestic financial institution, Kookmin Bank and Woori Bank. According to the results of analysis, executive officer can do earning management and accounting fraud under the current rule, K-IFRS 1039. To prevent that, it is urgently needed to change from K-IFRS 1039 to 1109. It can be expected that earning management would be reduced under K-IFRS 1039 compared to K-IFRS 1039. But there are some issues that dividends recognized in other comprehensive income, fair value measurement reliability and usability, recycling,comparability and accounting complexity if the introduction of K-IFRS 1109 is introduced.