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Investment contract with discretionary participation features

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Last update 04/01/2020 Investment contract with discretionary participation features – A financial instrument that provides a particular investor with the contractual right to receive, as a supplement to an amount not subject to the discretion of the issuer, additional amounts: that are expected to be a significant portion of the total contractual benefits; the timing … Read more

Defined Benefit Pension Plans

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Last update 13/12/2019 In traditional defined benefit pension plans, workers accrue a promise of a regular monthly payment from the date of their retirement until their death, or, in some cases, until the death of their spouse. The promised life annuity (deferred) is commonly based on a formula linked to an employee’s wages or salary … Read more

Investment component

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Last update 04/01/2020 Investment component – The amounts that an insurance contract requires the entity to repay to a policyholder even if an insured event does not occur. An example of an investment component is an insurance contract where premiums are paid into an account balance and that balance (or a portion thereof) is guaranteed … Read more

Deferred tax assets Future tax profits

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Last update 22/12/2019 The availability of future taxable profits – a problem in four parts Deferred tax assets Future tax profits The best starting point for determining the availability of future taxable profits is a company’s own business planning cycle and resulting forecasts. Using the company’s forecasts to assess the value of assets with potentially significant … Read more

Intrinsic value

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Last update 09/12/2019 Intrinsic value – The difference between the fair value of the shares to which the counterparty has the (conditional or unconditional) right to subscribe or which it has the right to receive, and the price (if any) the counterparty is (or will be) required to pay for those shares. For example, a … Read more

Deferred cost Capitalised costs EM industry

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Last update 25/11/2019 Deferred cost Capitalised costs EM industry is about other costs to obtain a contract in the entertainment and media (E&M) industry Incremental costs to obtain a contract will be capitalized if they are expected to be recovered. Such costs may be expensed as incurred as a practical expedient if the amortization period … Read more

Interest in other entities

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Last update 10/12/2019 Interest in other entities – For the purpose of IFRS 12 Disclosure of Interest in Other Entities, an interest in another entity refers to contractual and non-contractual involvement that exposes an entity to variability of returns from the performance of the other entity. An interest in another entity can be evidenced by, … Read more

Debt instruments at FVOCI

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Last update 29/11/2019 Debt instruments at FVOCI – A debt instrument is classified as subsequently measured at fair value through other comprehensive income (FVOCI) under IFRS 9 if it meets both of the following criteria: Hold to collect and sell business model test: The asset is held within a business model whose objective is achieved … Read more

Intangible assets – Example

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Last update 18/08/2019 Example accounting policy Intangible assets, other than goodwill, include expenditure on the exploration for and evaluation of oil and natural gas resources, computer software, patents, licences and trademarks and are stated at the amount initially recognized, less accumulated amortization and accumulated impairment losses. Intangible assets acquired separately from a business are carried … Read more

Dealer sales vehicle incentives

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Last update 20/12/2019 Dealer sales vehicle incentives – To apply IFRS 15, original equipment manufacturers (OEMs) will need to change the way they evaluate incentives. Original equipment manufacturers need to use significant judgement when they identify separate performance obligations (i.e., units of account), which may be different from those identified under IAS 18. Original equipment … Read more