IFRS Jargon

Last update 16/08/2019 IFRS 9 Definition: A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial asset is any asset that is: Cash; An equity instrument of another entity; A contractual right: to receive cash or another financial … Read more

Last update 16/11/2019 Financial guarantees IFRS 9 Definition: In general, a financial guarantee is a promise to take responsibility for another company’s financial obligation if that company cannot meet its obligation. The entity assuming this responsibility is called the guarantor. Such a guarantee can be limited or unlimited, making the guarantor liable for only a … Read more

Last update 16/11/2019 Financial guarantee contract – IFRS 17 Definition: A contract that requires the issuer to make specified payments, to reimburse the holder for a loss it incurs because a specified debtor fails to make a payment when due in accordance with the original or modified terms of a debt instrument. Further explanation These … Read more

Last update 16/08/2019 The asset is measured at fair value. Changes in fair value are recognised in profit and loss as they arise. Financial assets should be classified as fair value through profit or loss if they do not meet the criteria for fair value through other comprehensive income or amortised cost. Fair value through … Read more

Last update 05/02/2019 Accounting policy example Financial assets are recognized initially at fair value, normally being the transaction price plus, in the case of financial assets not at fair value through profit or loss, directly attributable transaction costs. The subsequent measurement of financial assets depends on their classification, as set out below. The group derecognizes financial assets … Read more

Last update 13/07/2019 A general definition/description is: A financial asset is a tangible liquid asset that gets its value from a contractual claim. Cash, stocks, bonds, bank deposits and the like are examples of financial assets. Unlike land, property, commodities or other tangible physical assets, financial assets do not necessarily have inherent physical worth. See … Read more

Last update 04/08/2019 Financial information that faithfully represents the phenomena that it purports to represent. A faithful representation provides information about the substance of an economic phenomenon instead of merely providing information about its legal form. A perfectly faithful representation would be complete, neutral and free from error. Providing a faithful representation is one of … Read more

Last update 24/11/2019 Fair value through profit or loss—any financial assets that are not held in one of the two business models (‘Hold to collect‘ and ‘Hold to collect and sell‘) mentioned are measured at fair value through profit or loss. Financial assets measured at fair value through profit or loss. This is part of … Read more

Last update 10/12/2019 Financial assets measured at fair value through other comprehensive income – this is part of the classification of financial assets. A financial asset is classified as subsequently measured at fair value through other comprehensive income (FVOCI) if: the contractual terms of the financial asset give rise on specified dates to cash flows … Read more

Last update 16/08/2019 In addition to the standards that require assets and liabilities to be reported at fair value, US GAAP and IFRS provide reporting entities with an option to measure many financial instruments and other items in the balance sheet at fair value. The fair value option (FVO) considerably expands the ability of a … Read more