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Foreign currency translation

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Last update 18/11/2019 There are two accounting events in which an entity must deal with foreign currency translation: Purchases, sales, cash receipts, cash payments, investments and other (individual) financial transactions in a currency other than the functional currency of the entity accounting for these transactions, Foreign currency translation Conversion of financial statements of a foreign … Read more

Significant increase in credit risk

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Last update 13/12/2019 Significant increase in credit risk – IFRS 9 contains a rebuttable presumption that credit risk has increased significantly when contractual payments are more than 30 days past due [IFRS 9 5.5.11]. This means that when payments are 30-days past due, the financial asset is considered to have moved from Stage 1 to … Read more

Foreign currency forward contracts

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Last update 28/11/2019 Foreign currency forward contracts is about one of the other changes from IAS 39 to IFRS 9 in respect of hedge accounting What is a forward element of forward contracts? A forward exchange contract is a special type of foreign currency transaction. Forward contracts are agreements between two parties to exchange two … Read more

Shares

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Last update 13/12/2019 Shares are financial instruments. A share is a certificate evidencing the rights of the shareholder, to whom it is granted, in a company. Shares may take bearer or registered form. One share of stock represents a fraction of the share capital of a corporation. Shares to be issued – Shares for which consideration … Read more

Foreign currency cash flows

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Last update 22/12/2019 Foreign currency cash flows – IAS 7.25 requires cash flows arising from transactions in a foreign currency to be recorded at the exchange rate between an entity’s functional currency and the foreign currency at the date of the cash flow. A similar approach is required for cash flows of a foreign subsidiary … Read more

Share capital

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Last update 31/12/2019 Share capital is the nominal value of the shares issued within equity of an entity. Only nominal values are debited (repayment of shares) or credited (issuance of shares), the difference with amounts subscribed is credited/debited to a separate account within equity. Share premium is the amount subscribed for share capital in excess … Read more

Foreign currency basis spreads

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Last update 28/11/2019 Foreign currency basis spreads is about one of the other changes from IAS 39 to IFRS 9 in respect of hedge accounting What is the cross currency basis spread In general, the cross currency basis is a measure of dollar shortage in the market. The more negative the basis becomes, the more … Read more

Service concession arrangement

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Last update 06/01/2020 A service concession arrangement is a binding arrangement between a grantor and an operator in which: The operator uses the service concession asset to provide a public service on behalf of the grantor for a specified period of time; and The operator is compensated for its services over the period of the … Read more

Food for thought for Property plant and equipment

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Last update 22/12/2019 Food for thought for Property plant and equipment – Economic benefits to be derived from an item of Property, plant and equipment (PPE) can be direct or indirect. An item of PPE may generate economic benefit individually or in association with other assets and liabilities. An item of PPE like safety and … Read more

Separability

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Last update 23/08/2019 The separability criterion means that an acquired intangible asset is capable of being separated or divided from the acquiree and sold, transferred, licensed, rented or exchanged, either individually or together with a related contract, identifiable asset or liability. An intangible asset that the acquirer would be able to sell, license or otherwise … Read more