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Last update 06/01/2020 [IFRS 17] Insurance contract – A contract under which one party (the issuer) accepts significant insurance risk from another party (the policyholder) by agreeing to compensate the policyholder if a specified uncertain future event (the insured event) adversely affects the policyholder. Further explanation: The assessment of whether the insurance risk is ‘significant’ … Read more
Last update 04/12/2019 Customer contracts and the related customer relationships – In a Business Combinations, these are intangible assets and are therefore recognised separately from goodwill, provided that their fair values can be measured reliably. These marketing-related intangible assets meet the definition of an intangible asset because they arise from contractual or other legal rights. … Read more
Last update 28/12/2019 Individual or collective assessment for impairment – An entity should normally identify significant increases in credit risk and recognise lifetime Expected Credit Losses (ECL) before default occurs or the financial asset becomes credit-impaired, either on an individual or collective basis. Individual or collective assessment for impairment It may not be practical to … Read more
Last update 13/12/2019 Indemnification assets – Dictionary meaning of Indemnification is ‘indemnification is the part of an agreement that provides for one party to bear the monetary costs, either directly or by reimbursement, for losses incurred by a second party’. Indemnification of an asset essentially provides kind of guarantee to the other party about the … Read more
Last update 23/11/2019 Current and non-current liabilities explains the liabilities as in the Conceptual Framework 2018: this is the definition: A liability is a present obligation of the entity to transfer an economic resource as a result of past events. A liability is defined as a company’s legal financial debts or obligations that arise during … Read more
Last update 04/01/2020 Income tax – by law, but with a lot of different perks dependent on the country one pays its taxes, businesses and individuals must file federal and state income tax returns every year to determine whether they owe taxes. Its two basic types are: Personal income tax, levied on incomes of individuals, … Read more
Last update 12/11/2019 In a currency swap operation, also known as a cross-currency swap, the parties involved agree under contract to exchange the following: the principal amount of a loan in one currency and the interest applicable on it during a specified period of time for a corresponding amount and applicable interest in a second … Read more
Last update 10/12/2019 In an active market (not inactive markets), transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. [IFRS 13 Definition] Inactive markets An orderly transaction assumes exposure to the market for a period before the measurement date to allow for marketing … Read more
Last update 03/11/2019 Curing of a credit-impaired financial asset presents the explanation of what a credit-impaired financial asset is, how to account for a credit-impaired asset as long as it is credit-impaired and how to account for a credit-impaired asset that is no longer credit-impaired (i.e. curing of a credit-impaired financial asset which means the … Read more
Last update 09/12/2019 Lease payments include any in-substance fixed lease payments. In-substance fixed lease payments are payments that may, in form, contain variability but that, in substance, are unavoidable. In-substance fixed lease payments exist, for example, if: payments are structured as variable lease payments, but there is no genuine variability in those payments. Those payments … Read more