IFRS Topics

Last update 16/11/2019 The Risk and Rewards Test and the Control Test are used to validate the accounting for a transfer of a financial asset under IFRS 9 Financial instruments. Based on criteria in previous steps it has been concluded that an entity has transferred a financial asset (see IFRS 9 B3.2.1). The central questions … Read more

Last update 30/11/2019 The Reporting Entity – The two most common reporting entities are a single legal entity preparing unconsolidated or company accounts or a group of legal entities preparing consolidated financial statements. Consolidation can be done at different levels, the most common being at the ultimate parent legal company level (the highest legal entity … Read more

Last update 24/12/2019 The relevant activities of an investee – Don’t get fooled, relevant activities for financial reporting and consolidation purposes does not mean that the activities of an investee are the same as the activities of other entities (parent entity and subsidiary entities) consolidated into that one group. No…….. it is about whether the … Read more

Last update 27/11/2019 The practical expedient not to use Level 1 inputs is about facilitating traders and financial institutions that have tools to more or less automatically update pricing of securities using big data. As a practical expedient, an entity may measure the fair value of certain assets and liabilities using an alternative method that … Read more

Last update 26/11/2019 To provide financial information about the reporting entity that is useful to existing and potential investors, lenders and other creditors in making decisions about providing resources to the entity. Those decisions involve buying, selling or holding equity and debt instruments, and providing or settling loans and other forms of credit. Topics hide … Read more

Last update 25/11/2019 IFRS requires financial statements to be prepared on the modified historical cost convention basis, with a growing emphasis on fair value. ‘Fair value’ is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date – … Read more

Last update 26/11/2019 The measurement period in business combinations explains the one year window allowed in properly accounting for business combinations or as they have been called in the past ACQUISITIONS. The accounting for a business combination requires substantial effort and resources. The initial accounting often is incomplete at the end of the reporting period … Read more

Last update 24/12/2019 The Main Statements of Financial Statements – This is some explanation of the basic presentation of Financial Statements into a categorised format that is useful for the most of the users for Financial Statements. There are four main financial statements: Statement of Financial Position, Statement of Profit or Loss and Other Comprehensive … Read more

Last update 23/12/2019 The investors exposure or right to variable returns – For an investor to have control over an investee it must have exposure, or rights, to variable returns from the investee. IFRS 10 provides the following examples of variable returns: dividends, The investors exposure or right to variable returns other distributions of economic … Read more

Last update 12/12/2019 The IFRS 9 Framework for financial assets is a decision model to help you go through decisions with regard to the classification and measurement of financial assets. IFRS 9 recognises three different accounting policies for financial instruments. These principles determine the value of the financial instruments on the balance sheet. Amortised cost … Read more