IFRS Jargon

Last update 29/12/2019 Asset-backed securities (ABSs) are structured finance products backed by pools of assets and are created through a securitisation process. The risks in asset-backed securities, such as credit risk, prepayment risk, market risks, operational risk, and legal risks, are directly connected with the asset pool and the structuring of the securities. Securitisation is … Read more

Last update 04/01/2020 IAS 19 Definition: Asset ceiling – The asset ceiling is the present value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the defined benefit plan. Net defined benefit liability (asset) – The net defined benefit liability (asset) is the deficit or … Read more

Last update 18/11/2019 IFRS 9 Definition of amortised cost: The amount at which the financial asset or financial liability is measured at initial recognition minus the principal repayments, plus or minus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount and, for financial assets, adjusted … Read more

Last update 06/12/2019 Agriculture-related definitions IAS 41 Definition Agricultural activity: The management by an entity of the biological transformation and harvest of biological assets for: Sale; Distribution at no charge or for a nominal charge; or Conversion into agricultural produce or into additional biological assets for sale or for distribution at no charge or for … Read more

Last update 02/08/2019 IAS 41 Definition: The management by an entity of the biological transformation and harvest of biological assets for: Sale; Distribution at no charge or for a nominal charge; or Conversion into agricultural produce or into additional biological assets for sale or for distribution at no charge or for a nominal charge. Agricultural … Read more

Last update 31/07/2019 The adding together of individual items that share characteristics and are classified together. Materiality and aggregation An entity shall present separately each material class of similar items. An entity shall present separately items of a dissimilar nature or function unless they are immaterial. [IAS 1 29] Financial statements result from processing large … Read more

Last update 31/07/2019 A party that is primarily engaged to act on behalf of, and for the benefit of, another party (the principal) and therefore does not control the investee when it exercises its decision-making authority. The definition is derived from agency theory. In company law, the directors act as agents of the company. The … Read more

Last update 31/07/2019 IAS 10 Definition: Those events, both favourable and unfavourable, that occur between the reporting date and the date when the financial statements are authorised for issue. Two types of events can be identified: Those that provide evidence of conditions that existed at the reporting date (adjusting events after the reporting date); and … Read more

Last update 20/11/2019 Adjusted market pricing relates to the fair value pricing of assets held by investors in an investment portfolio. Such assets are debt instruments and equity instruments, with both instruments either being traded in a market/stock/bonds exchange or in a private market. In comparison to assets, observable active markets for liabilities and equities … Read more

Last update 08/12/2019 Actuarial assumptions Actuarial terms Estimates of future experience with respect to rates of mortality, disability, turnover, retirement, rate or rates of investment income, and salary increases. Decrement assumptions (rates of mortality, disability, turnover and retirement) are generally based on past experience, often modified for projected changes in conditions. Economic assumptions (salary increases … Read more