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Last update 26/11/2019 Control Structured entity with Credit-linked notes provides a case regarding control through contractual arrangements in a Special Purpose Vehicle or better NO control. Following is a case on the assessment whether certain stakeholders in a transaction/structure have obtained control over a certain entity in the transaction in line with the requirements of … Read more
Last update 17/12/2019 General model of measurement of insurance contracts – Insurance contracts may be highly complex bundles of interdependent rights and obligations and combine features of a financial instrument and features of a service contract. As a result, insurance contracts can provide their issuers with different sources of income – e.g. underwriting profit, fees from … Read more
Last update 23/12/2019 Control over structured entities – Although IFRS 10 has no separate guidance on Special Purpose Entities (SPEs), it does have guidance on assessing control over entities for which voting rights do not have a significant effect on returns. Despite the lack of a definition, entities typically considered to be SPEs in practice … Read more
Last update 09/12/2019 The general approach expected credit losses is what it is the most accepted or normal or preferred way of loss provisioning financial assets to a level at which it is becoming unlikely that they are overstated. Under the “expected credit loss” model, an entity calculates the allowance for credit losses by considering … Read more
Last update 20/11/2019 Control over CMBS issuer Structured entity is a case on the assessment whether certain stakeholders in a transaction/structure have obtained control over a certain entity in the transaction in line with the requirements of IFRS 10 Consolidated financial statements. Only one stakeholder can be in control! [IFRS 10 B16] Or no stakeholder … Read more
Last update 17/08/2019 Qualitative characteristics that financial information must possess to make it useful to the primary users of general purpose financial reports. They are relevance and faithful representation. Relevance Relevant financial information is capable of making a difference in the decisions made by users. Information may be capable of making a difference in a … Read more
Last update 30/11/2019 Control of an economic resource – This is all about: A present economic resource controlled by the entity as a result of past events. Two very simple examples to start with: Pat Co has purchased a patent for $20,000. The patent gives the company sole use of a particular manufacturing process which … Read more
Last update 06/12/2019 Full derecognition with recognition of new assets or liabilities Full derecognition (transferred off-balance sheet) – with recognition of any new assets or liabilities Assets 95% of transfers resulting in full recognition are simple, the entity that has recorded a financial asset receives cash and removes the asset from its financial position. However, … Read more
Last update 18/11/2019 This is a discussion on IFRS 10 – IFRS 12 Control Joint control Significant influence and the accounting applied. It is added with some other logical IFRS topics: the fair value option and the other investments (no control, no joint control and no significant influence). Topics hide Control Joint control Joint control … Read more
Last update 18/12/2019 Fulfilment cash flows comprise: a current estimate of unbiased and probability-weighted future cash flows expected to arise during the life of the contract; a discount adjustment to reflect the time value of money and financial risks, such as liquidity and currency risks (layers of discounting); an explicit risk adjustment for non-financial risks. … Read more