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Last update 20/11/2019 IFRS 10 Consolidation Assess control over an investment is the key to consolidate a investee entity or not. Whether a subsidiary or a consolidated structured entity. Topics hide Voting rights in subsidiaries Contractual relations for consolidated structured entities Identifying relevant activities Evaluating power Assessing returns Link between power and returns Potential voting … Read more
Last update 25/11/2019 Previous guidance allowed/required items to be classified as extraordinary when they were deemed both unusual and infrequent. Events or transactions meeting the criteria for classification as extraordinary were required to be segregated from the results of ordinary operations (Operational income or income from operations) and shown separately in the income statement, net … Read more
Last update 23/12/2019 Consolidation and same reporting date – The basic requirement in IFRS 10 is that each group entity’s financial statements are drawn up to the same reporting date for consolidation purposes. Where reporting dates differ, additional financial information is prepared for consolidation purposes, unless impractical. [IFRS 10 B92]. The financial statements of the … Read more
Last update 20/11/2019 Expected Credit Losses IFRS 13 definition: The weighted average of credit losses with the respective risks of a default occurring as the weights. Under the “expected credit loss” model, an entity calculates the allowance for credit losses by considering on a discounted basis the cash shortfalls it would incur in various default scenarios … Read more
Last update 26/11/2019 Consolidated subsidiaries joint operations and other entities Investments in joint ventures associates and structured entities – want a quick understanding of all control nuances, read this! IFRS 12 provides one comprehensive disclosure standard for equity instruments in Subsidiaries, Joint arrangements (Joint operations and Joint ventures), Associates and Structured entities. Hence, management needs … Read more
Last update 05/01/2020 IFRS 13 Definition of expected cash flow: The probability-weighted average (ie mean of the distribution) of possible future cash flows. Context Topics hide Estimated cash flow and expected cash flow Expected cash flow Estimated cash flow and expected cash flow In the past, accounting pronouncements have used the terms estimated cash flow … Read more
Last update 30/11/2019 Consolidated or unconsolidated financial statements – Consolidated financial statements provide information about the assets, liabilities, equity, income and expenses of both the parent and its subsidiaries as a single reporting entity. That information is useful for existing and potential investors, lenders and other creditors of the parent in their assessment of the … Read more
Last update 27/12/2019 The expected attrition rate is used in valuing customer-related assets using the Multi-period excess earnings method (MPEEM), a discounted cash flow model, the valuation expert should identify the portion of revenue expected to be generated through repeat customers existing as of the valuation date. The estimated future revenue is derived from the … Read more
Last update 03/12/2019 Considerations for cloud arrangements – Cloud services arrangements may include the cloud services (such as software-as-a-service (SaaS)) or other products or services. These arrangements also frequently include a licence of the software, for which the customer may (or may not) have the right to take possession. Cloud services entities also frequently offer … Read more
Last update 05/01/2020 Exit price Entry price IFRS 13 Definition – Exit price: The price that would be received to sell an asset or paid to transfer a liability. Exit price Entry price IFRS 13 Definition – Entry price: The price paid to acquire an asset or received to assume a liability in an exchange … Read more