IFRS Box

Did you know that the world-wide economic crisis followed by the recession caused a sharp downfall of assets’ prices? In some countries, the prices of property fell by 30-50%! Such a steep and fast decrease had an impact on the IFRS financial reporting, too. Companies showing assets in their accounts had to reassess their book … Read more

Business world as of today presents a huge amount of various risks to almost every company or entrepreneur. I’m sure that also your company faces at least some of these risks: foreign currency risk, price risk, inflation risk, credit risk – just name it. Many businesses decided to do something about these risks and started … Read more

Does your company remunerate its top management by granting them own shares? Or,   do employees receive bonuses based on the increase of the company’s share price? Transactions whereby companies pay for the goods or services received by issuing shares or similar instruments are very common in these days. In fact, their volume is rapidly … Read more

The year 2013 started off with some really significant IFRS amendments that you need to take into account when preparing your IFRS financial statements as at 31 December 2013. Although these changes should be applied in the year 2013 for the first time, you also need to restate your comparative figures for the previous reporting … Read more

Do you work in the production company? And did you find out that some of your production assets are still in operation but they were fully depreciated? In this case, the original estimate of machinery’s useful life proved to be incorrect. Here’s one of the questions I received: “Dear Silvia, we are a manufacturing company. … Read more

Ignoring an accrual principle??? What?! No way! That’s the basic accounting rule we should all follow! Yes, of course, you’re right. BUT: There IS an exception. The statement of cash flows. Preparing the statement of cash flows might become the biggest accountant’s nightmare. Why is that? Because the statement of cash flows is THE ONLY … Read more

These days people use about 180 currencies world wide! The truth is that  we, people, don’t want to stay isolated.  We love to sell, buy, import, export, trade together and do many other things,  all in foreign currencies! When you look at the business world, you’ll see that business go global in two ways: they … Read more

The first thing you need to do before you even start to play with hedge accounting is to determine the TYPE of hedge relationship that you’re dealing with. Why? Because: the type of hedge determines your accounting entries. Make no mistake here. If you incorrectly identify the type of the hedge, then your hedge accounting … Read more

When to recognize revenue? This simple question is one of the most controversial issues in today’s accounting. Why? Well, it’s simple and easy when you sell goods, but how about long-term contracts or some sort of services? You need to have some rules on WHEN to recognize the revenue from all these things, because all … Read more

Buying a foreign company or just some shares, building up an entirely new business or starting mutual venture with somebody else are some basic ways of spreading the business activities. Consolidation goes “hand in hand” with any foreign business. But what is it? Many people refer to consolidation when they speak about their share in … Read more