IFRS Topics

Last update 04/12/2019 The general approach is as the name more or less implies the ‘normal’ approach to calculate an impairment loss on financial assets (at amortised costs (for example trade receivables) or at the fair value OCI option), loan commitments and financial guarantee contracts (both not at FVPL), lease receivables and contract assets (with … Read more

Last update 30/11/2019 The elements of financial statements are the classes of items contained in the financial statements. Financial statements portray the financial effects of transactions and other events by grouping them into broad classes according to their economic characteristics. These broad classes are termed the elements of financial statements.   There are two main … Read more

Last update 26/12/2019 The ECL requirements (Expected Credit Losses)  in IFRS 9 makes the initial selection of bonds for fixed income investments by financial institutions much more important, as selecting bonds with good long-term credit health is key to reducing the risk of future P&L fluctuations caused by changes in ECL. This is especially important … Read more

Last update 23/11/2019 The different IFRS valuation premises are? That is the question and this is the answer. The different valuation premises available in IFRS and how they are used are: Stand-alone valuation premise A basis used to determine the fair value of an asset that provides maximum value to market participants principally on a … Read more

Last update 04/12/2019 The credit adjusted approach applies only rarely when an entity acquires or originates a loan or receivable that is “credit impaired” at the date of its initial recognition (e.g., when a loan is acquired at a deep discount due to credit concerns via a business combination). This is part of the impairment … Read more

Last update 30/09/2019 The costs of financial reporting measurement are not just the routine, recurring costs that an entity incurs directly. They also include one-off costs in setting up and documenting the relevant methods and systems and in training staff, and indirect expenses such as the costs of audit. The cost of maintaining a measurement … Read more

Last update 16/09/2019 SellCo sells a building to BuyCo for cash of CU1,800,000, which is its fair value at that date. The previous carrying value of the building is CU1,000,000. At the same time, SellCo enters into a lease with BuyCo conveying back the right to use the building for 18 years. Annual payments are … Read more

Last update 03/12/2019 The best of 10 Accounting conventions – In order to enable a very diverse population of users of financial statement a basis set of accounting conventions have to be more or less defined. The word convention is used in a Wikipedia definition way – a set of agreed, stipulated, or generally accepted … Read more

Last update 15/12/2019 The basic concepts bootcamp on IFRS all blogs is about International Financial Reporting Standards, usually called IFRS, that are accounting standards issued by the IFRS Foundation and the International Accounting Standards Board (IASB) to provide a common global language for business affairs so that company accounts are understandable and comparable across international boundaries. They are a consequence of growing international … Read more

Last update 08/12/2019 The Acquisition Method illustrated – a little history of acquisitions, mergers, purchase accounting, pooling of interests, goodwill, intangible assets acquired and the current end to this IFRS 3 Business Combinations. This is a developing story I will add stuff to end with a complete overview. The short case: The Acquisition Method illustrated … Read more