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Last update 12/11/2019 Topics hide Introduction References (to familiarise yourself with the subject): What are the inputs to the model? Revenue Revenue growth Turnover/Attrition Terminal value Net margin Inventory write-up Contributory asset charge Charge for trade names Charge for other technology Income tax rate Unit of measurement Partial first year factor Present Value Factor Present … Read more
Last update 17/12/2019 Insurance contracts acquired in the run-off period – An otherwise solvent insurer determines that it wishes to exit from a particular class of insurance contracts, but wishes to continue underwriting in other classes. This could be the result of strategic considerations, lack of profitability in the to be discontinued class, or a … Read more
Last update 01/12/2019 Customer lists – In a Business Combinations, this is a intangible asset and is therefore recognised separately from goodwill, provided that its fair value can be measured reliably. This customer-related intangible asset does not arise from contractual or other legal rights, but meets the definition of an intangible asset because it is … Read more
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