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Last update 26/11/2019 To provide financial information about the reporting entity that is useful to existing and potential investors, lenders and other creditors in making decisions about providing resources to the entity. Those decisions involve buying, selling or holding equity and debt instruments, and providing or settling loans and other forms of credit. Topics hide … Read more

Last update 25/11/2019 IFRS requires financial statements to be prepared on the modified historical cost convention basis, with a growing emphasis on fair value. ‘Fair value’ is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date – … Read more

Last update 26/11/2019 The measurement period in business combinations explains the one year window allowed in properly accounting for business combinations or as they have been called in the past ACQUISITIONS. The accounting for a business combination requires substantial effort and resources. The initial accounting often is incomplete at the end of the reporting period … Read more

Last update 24/12/2019 The Main Statements of Financial Statements – This is some explanation of the basic presentation of Financial Statements into a categorised format that is useful for the most of the users for Financial Statements. There are four main financial statements: Statement of Financial Position, Statement of Profit or Loss and Other Comprehensive … Read more

Last update 23/12/2019 The investors exposure or right to variable returns – For an investor to have control over an investee it must have exposure, or rights, to variable returns from the investee. IFRS 10 provides the following examples of variable returns: dividends, The investors exposure or right to variable returns other distributions of economic … Read more

Last update 12/12/2019 The IFRS 9 Framework for financial assets is a decision model to help you go through decisions with regard to the classification and measurement of financial assets. IFRS 9 recognises three different accounting policies for financial instruments. These principles determine the value of the financial instruments on the balance sheet. Amortised cost … Read more

Last update 04/12/2019 The general approach is as the name more or less implies the ‘normal’ approach to calculate an impairment loss on financial assets (at amortised costs (for example trade receivables) or at the fair value OCI option), loan commitments and financial guarantee contracts (both not at FVPL), lease receivables and contract assets (with … Read more

Last update 30/11/2019 The elements of financial statements are the classes of items contained in the financial statements. Financial statements portray the financial effects of transactions and other events by grouping them into broad classes according to their economic characteristics. These broad classes are termed the elements of financial statements.   There are two main … Read more

Last update 26/12/2019 The ECL requirements (Expected Credit Losses)  in IFRS 9 makes the initial selection of bonds for fixed income investments by financial institutions much more important, as selecting bonds with good long-term credit health is key to reducing the risk of future P&L fluctuations caused by changes in ECL. This is especially important … Read more

Last update 23/11/2019 The different IFRS valuation premises are? That is the question and this is the answer. The different valuation premises available in IFRS and how they are used are: Stand-alone valuation premise A basis used to determine the fair value of an asset that provides maximum value to market participants principally on a … Read more