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Levy

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Last update 31/12/2019 A levy is defined [in IFRIC 21 ] as an outflow of resources (embodying economic benefits) that is imposed by governments (including government agencies and similar bodies whether local, national or international) on entities in accordance with legislation (i.e., laws and/or regulations)1. Included (in scope) Excluded (out of scope)   IFRIC 21 … Read more

Determining stand-alone selling prices

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Last update 25/11/2019 Determining stand-alone selling prices is a logical step in determining the correct pricing of a contract under IFRS 15. To allocate the transaction price on a relative stand-alone selling price basis, an entity must first determine the stand-alone selling price of the distinct good or service underlying each performance obligation. Under the … Read more

Legally enforceable contract

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Last update 10/12/2019 Legally enforceable contract – A contract, under the broadest possible definition, is a legally enforceable promise. Contracts are classified in many different ways. For example, a contract may be unilateral (a promise by one party to another) or bi- or multilateral (a set of complementary promises made by and between more than … Read more

Determining significant increases in credit risk

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Last update 24/12/2019 Determining significant increases in credit risk – The transition from recognising 12-month expected credit losses (i.e. Stage 1) to lifetime expected credit losses (i.e. Stage 2) in IFRS 9 Financial Instruments is based on the notion of a significant increase in credit risk over the remaining life of the instrument. The focus … Read more

Leases

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Last update 06/01/2020 Leases explained along defined terms to obtain a quick overview. An overview is provided here. Definitions from IFRS 16 Leases are: IFRS 16 Leases: A contract, or part of a contract, that conveys the right to use an asset (the underlying asset) for a period of time in exchange for consideration. Lease … Read more

Determining annual pension expense

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Last update 22/12/2019 Determining annual pension expense – In general terms, pension expense reported in the statement of profit or loss is driven by how much the pension liability increased during the year, net of returns on the plan’s assets. Normally, a pension liability increases as employees earn additional future benefits from an additional year … Read more

Land easements

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Last update 10/12/2019 Land easements or rights of way are rights to use, access or cross another entity’s land for a specified purpose. For example, a land easement might be obtained for the right to construct and operate a pipeline or other assets (e.g., railway line, utility pipes or telecommunication lines) over, under or through … Read more

Determine the transaction price property construction

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Last update 26/11/2019 Determine the transaction price property construction considers key implications IFRS 15 Revenue from Contracts with Customers for real estate entities. It provides an overview of the revenue recognition model in IFRS 15 with a focus on entities that: Own, operate and sell real estate Determine the transaction price property construction Provide property … Read more

Key performance indicator

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Last update 09/12/2019 Key Performance Indicators (KPIs) are the critical (key) indicators of progress toward an intended result. KPIs provides a focus for strategic and operational improvement, create an analytical basis for decision making and help focus attention on what matters most. As Peter Drucker famously said, ‘What gets measured gets done’. Managing with the … Read more

Key management personnel

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Last update 19/11/2019 Key management personnel is one of the related parties. Related parties are relationships in which one party has the ability to control or significantly influence the economic and operating decisions of another. Transactions with related parties are a common feature of business. Key management personnel (KMP) is defined in IAS 24 Related … Read more