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Last update 23/11/2019 Reseller and distributor arrangements describes the changes distributors and resellers might have to apply to their accounting for revenue, distribution arrangements and movements of products between for example dealers. IFRS 15 changes practice for entities that sell their products through distributors or resellers. IFRS 15 changes practice for entities that sell their … Read more

Last update 01/12/2019 Required Disclosure for error restatements – If an error (either accidental or intentional in nature) is subsequently discovered that affected a prior period, the nature of the error, its effect on previously issued financial statements, and the effect of its adjustment on current period’s net income and EPS should be disclosed in … Read more

Last update 19/12/2019 Repurchase options and residual value guarantees – Original Equipment Manufacturers (OEMs) may have a right or obligation to repurchase vehicles as part of a contract with a customer or may provide residual value guarantees to certain customers. Examples include repurchase options on sales of fleet vehicles or residual value guarantees to fleet … Read more

Last update 29/11/2019 Repurchase agreement – This is an illustration of how derecognition is applied in practice. The objective is to present the mechanics of applying the IFRS 9 requirements for derecognition of financial assets, starting with an analysis of the transaction using the flowchart [IFRS 9 B3.2.1], and culminating with the initial and subsequent … Read more

Last update 30/11/2019 A reporting period is the span of time covered by a set of financial statements, normally a year from 1 January Year to 31 December Year. The reporting period also called accounting period can also be for a interim period either for a month or quarter. Reporting entities consistently use the same … Read more

Last update 12/12/2019 Reporting lines in Other Operating Income – What has to be included in profit or loss and what should be included in other comprehensive income? The answer is defined practical in IFRS (IAS 1 Presentation of Financial Statements, in 7 Definitions): Other comprehensive income (OCI) comprises items of income and expense (including … Read more

Last update 22/12/2019 Relationship of Growth ROIC and Cash Flow – Disaggregating cash flow into revenue growth and ROIC helps illuminate the underlying drivers of a company’s performance. Say a company’s cash flow was $100 last year and will be $150 next year. This doesn’t tell us much about its economic performance, since the $50 … Read more

Last update 26/11/2019 Related parties transfer pricing is one of the most important issues in international tax and as a result also needs disclosure under IAS 24 Related party disclosures. Transfer pricing is the general term for the pricing of cross‐border, intra‐firm transactions between related parties. These transactions can include transfers of intangible property, tangible … Read more

Last update 30/09/2019 This example case illustrates the partial exemption for government-related entities [IAS 24 25]: Government G directly or indirectly controls Entities 1 and 2 and Entities A, B, C and D. Person X is a member of the key management personnel of Entity 1.   For Entity A’s financial statements, the exemption in … Read more

Last update 17/12/2019 Reinsurance contracts held – A reinsurance contract is an insurance contract issued by one entity (the reinsurer) to compensate another entity for claims arising from one or more insurance contracts issued by the other entity (underlying contracts). IFRS 17 requires a reinsurance contract held to be accounted for separately from the underlying … Read more