IAS 32 sets out conditions for offsetting financial assets and financial liabilities in the statement of financial position. In order to be eligible for offsetting, the following conditions must be met:

1. The entity must have a legally enforceable right to set off the amounts, and must intend to settle on a net basis, or to realize the asset and settle the liability simultaneously.
2. The entity must have a legally enforceable right to set off the financial asset and the financial liability, and the right must not be contingent on a future event.
3. The entity must be able to settle the net amount, or realize the asset and settle the liability simultaneously, without requiring the consent of another party or relying on a third party to fulfill its obligation.
4. The financial asset and the financial liability must be with the same counterparty, or with counterparties that are part of the same netting arrangement.

If the above conditions are met, the financial assets and financial liabilities can be presented on a net basis in the statement of financial position. If the conditions are not met, the financial assets and financial liabilities must be presented gross in the statement of financial position. The offsetting of financial assets and financial liabilities is important because it can have a significant impact on an entity's financial position and performance.