Current and non-current liabilities

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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

Income tax

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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

Currency SWAP operation

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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

Inactive markets

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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

Curing of a credit-impaired financial asset

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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

In-substance fixed lease payments

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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

Cross-currency swap

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Last update 22/12/2019 Cross-currency swap – 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 … Read more

Impracticable

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Last update 17/08/2019 It is impracticable to apply a requirement if the entity cannot apply it after making every reasonable effort to do so. ‘Impracticable’ is a high hurdle. What constitutes undue cost or effort is a matter of judgement. In short: IFRS definition IAS 8: Applying a requirement is impracticable when the entity cannot … Read more

Credit risk on the hedging instrument

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Last update 27/11/2019 Credit risk on the hedging instrument and credit risk on the hedged item and the impact of changes in these credit risks should not be of a magnitude such that it dominates the value changes, even if there is an economic relationship between the hedged item and hedging instrument. Credit risk can … Read more

Impairment of assets

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Last update 17/08/2019 Impairment of assets requires that the recoverable amount of an asset should be estimated whenever there is indication that the asset may be impaired. Impairment of assets requires an impairment loss to be recognised (an asset is impaired) whenever the carrying amount of an asset exceeds its recoverable amount. An impairment loss … Read more