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Aggregation disaggregation and materiality

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Last update 22/11/2019 Aggregation disaggregation and materiality are cornerstones of financial reporting using IFRS. Here is a summary of the financial reporting items that include (mostly) disclosure requirements that relate to these cornerstones. See also Aggregation for an overview of general financial reporting rules in that respect. Aggregation disaggregation and materiality Fair value measurement Present … Read more

Bonds

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Last update 13/12/2019 Bonds or debentures are financial instruments. A bond is a certificate or evidence of a debt on which the issuing company or governmental body promises to pay the bondholders a specified amount of interest for a specified length of time and to repay the loan on the expiration date. A bond may … Read more

Agency relationships in consolidation

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Last update 23/12/2019 Agency relationships in consolidation – An investor with decision making rights has to determine whether it is a principal or an agent. An ‘agent’ is defined as ‘a party primarily engaged to act on behalf and for the benefit of another party or parties (the principal(s)) and therefore does not control the … Read more

Biological assets, Agricultural produce, Harvested products

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Last update 02/08/2019   The table below provides examples of biological assets, agricultural produce, and products that are the result of processing after harvest: Biological assets Agricultural produce Products that are the result of processing after harvest Sheep Wool Yarn, carpet Trees in a timber plantation Felled trees Logs, lumber Dairy cattle Milk Cheese Pigs … Read more

Advance payment to purchase Property plant and equipment

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Last update 17/12/2019 Advance payment to purchase Property plant and equipment is an example presented in IFRIC 22 Foreign Currency Transactions and Advance Consideration. Other examples are: Multiple advances and multiple service deliveries, Multiple advances and multiple deliveries of goods and Multiple advances for one delivery of goods. These examples accompany, but are not part … Read more

Basis adjustment

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Last update 09/12/2019 [IFRS 9 Fair value hedge] The adjustment to the amortized cost basis of the hedged item from applying fair value hedge accounting is referred to as a basis adjustment. Basis adjustments are accounted for in the same manner as other components of the amortized cost basis of the hedged item.  Explanations: Basis … Read more

Adjusted net asset method tangible asset example

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Last update 25/11/2019 The adjusted net asset method tangible asset example is used to value a business based on the difference between the fair market value of the business assets and its liabilities. Depending on the particular purpose or circumstances underlying the valuation, this method sometimes uses the replacement or liquidation value of the company assets … Read more

Associate

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Last update 17/11/2019 Associate – IFRS 12 Definition: An entity, including an unincorporated entity such as a partnership, over which the investor has significant influence, and that is neither a controlled entity nor an interest in a joint venture. Associates are all entities over which the group has significant influence but not control or joint … Read more

Adjusted net asset method negative goodwill example

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Last update 25/11/2019 The adjusted net asset method negative goodwill example is used to value a business based on the difference between the fair market value of the business assets and its liabilities. Depending on the particular purpose or circumstances underlying the valuation, this method sometimes uses the replacement or liquidation value of the company assets … Read more

Assets of low value

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Last update 06/01/2020 IFRS 16 Leases introduced the term ‘Assets of low value’. IFRS 16 does not provide much guidance to assess what ‘low value’ means. There is no definition. The value referred to as ‘low value’ is the value of the asset when it was new, regardless of the age of the asset at … Read more