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Last update 29/11/2019 Sale of specifically identified cash flows – This is an illustration of how derecognition is applied in practice. The objective is to present the mechanics of applying the IFRS 9 requirements for derecognition of financial assets, starting with an analysis of the transaction using the flowchart [IFRS 9 B3.2.1], and culminating with … Read more

Last update 29/11/2019 Sale of loans guarantee retained – This is an illustration of how derecognition is applied in practice. The objective is to present the mechanics of applying the IFRS 9 requirements for derecognition of financial assets, starting with an analysis of the transaction using the flowchart [IFRS 9 B3.2.1], and culminating with the … Read more

Last update 25/11/2019 Sale of hardware and installation services provides practical insight in revenue recognition of mixed contracts with customers under IFRS 15. Two very similar sales transactions/contracts but one with only one single performance obligation and the other with separate performance obligations. Case 1 – separate performance obligations Sale of hardware and installation services … Read more

Last update 29/11/2019 Sale of equities subject to call option – This is an illustration of how derecognition is applied in practice. The objective is to present the mechanics of applying the IFRS 9 requirements for derecognition of financial assets, starting with an analysis of the transaction using the flowchart [IFRS 9 B3.2.1], and culminating … Read more

Last update 01/10/2019 IFRS 16 makes significant changes to sale and leaseback accounting. A sale and leaseback transaction is one where an entity (the seller-lessee) transfers an asset to another entity (the buyer-lessor) for consideration and leases that asset back from the buyer-lessor. A sale and leaseback transaction is a popular way for entities to … Read more

Last update 11/11/2019 IFRS 15 Royalty income intellectual property provides application guidance on the recognition of revenue for sales-based or usage-based royalties on licences of intellectual property, which differs from the requirements that apply to other revenue from licences. IFRS 15 B63 requires that royalties received in exchange for licences of intellectual property are recognised … Read more

Last update 17/12/2019 Risk adjustment for non-financial risks – The third element of measuring fulfilment cash flows in the general model (see ‘General model of measurement of insurance contracts‘) is a risk adjustment for non-financial risk. Here is how the risk adjustment for non-financial risks fits into the general model of measurement of insurance contracts. … Read more

Last update 30/11/2019 Introduction – set the stage Rights with potential to produce economic benefits – This is all about: An economic resource is a right that has the potential to produce economic benefits. Many assets, for example, receivables and property, are associated with legal rights, including the right of ownership. In determining the existence … Read more

Last update 17/12/2019 Right to obtain economic benefits from use – To control the use of an identified asset, a customer is required to have the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use (for example, by having exclusive use of the asset throughout … Read more

Last update 04/12/2019 Right to control the use of the identified asset – A contract conveys the right to control the use of an identified asset for a period of time if, throughout the period of use, the customer has the right to obtain substantially all of the economic benefits from the use of the … Read more