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Last update 04/01/2020 Sales tax and VAT Sales tax is collected by the retailer when the final sale in the supply chain is reached via a sale to the end consumer. End consumers pay the sales tax on their purchases. Businesses issue resale certificates to their sellers when buying business supplies/inputs that will be resold … Read more
Last update 20/12/2019 Right of return – IFRS 15 notes that, in some contracts, an entity may transfer control of a product to a customer, but grant the customer the right to return. In return, the customer may receive a full or partial refund of any consideration paid; a credit that can be applied against … Read more
Last update 01/10/2019 IFRS 15 Revenue from Contracts with Customers (contents page is here) introduced a single and comprehensive framework which sets out how much revenue is to be recognised, and when. The core principle is that a vendor should recognise revenue to depict the transfer of promised goods or services to customers in an … Read more
Last update 29/12/2019 As part of IAS 16 Property, Plant and Equipment it is possible to use the revaluation model. An asset will be carried at its fair value at the revaluation date less subsequent depreciation and/or impairment. Gains/losses arising on the revaluation of an entity’s property (other than investment property) are recorded within equity … Read more
Last update 20/12/2019 Just some highlights how financial statements for entities holding investment properties are different from more general purpose financial statements. Just like financial institutions and in the past companies with building and construction activities have/had their own industry specific IFRS that cover/covered the reporting of useful information outside the general/mainstream IFRS reporting rules. … Read more
Last update 04/01/2020 The return on average capital employed (ROACE) is a ratio that reveals the profitability against the investments made in the company. The return on average capital employed is different from the return on capital employed for it counts the average of the opening and closing capital for the specific period contrasting to only the … Read more
Last update 23/12/2019 Financial reporting models – This is a note on the innovative history of Philips’ financial reporting, see the ‘Introduction to a history of innovation in financial reporting‘. Literature suggests that voluntary disclosure of financial reporting is associated with participatory, democratic ownership structures. Conversely, secretive attitudes are fostered by the centralization of equity … Read more
Last update 28/12/2019 Retrospective or prospective application Retrospective application – Applying a new accounting policy to transactions, other events, and conditions as if that policy had always been applied (change in accounting policy) (IAS 8 5). OR Correcting the recognition, measurement and disclosure of amounts of elements of financial statements as if a prior period … Read more
Last update 21/12/2019 Financial reporting in change – Many different bodies of practices are used around the world for external financial reporting and these include different approaches to measurement. Different jurisdictions have developed their own financial reporting requirements, influenced by differences in the uses made of financial reporting information and in business and regulatory environments. … Read more
Last update 06/01/2020 IAS 37 Definition of Restructuring: A program that is planned and controlled by management, and materially changes either: The scope of an entity’s activities; or The manner in which those activities are carried out. Restructure costs are recognized as soon as there is a present obligation (legal or constructive) resulting from a … Read more