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Many IFRS standards require you to measure the fair value of some items. Just name the examples: financial instruments, biological assets, assets held for sale and many other. In the past, there was limited guidance on how to set fair value; the guidance was spread throughout the standards and often very conflicting. Therefore, IFRS 13 … Read more
Some time ago, standard IAS 1 Presentation of Financial Statements significantly changed and introduced the statement of other comprehensive income. And then it began: lots of confusion, frustration and doubts! Many of us simply did not get the point and started to flounder in the fog. What items belong to OCI? What items belong to … Read more
Benjamin Franklin once wrote: “In this world nothing can be said to be certain, except death and taxes“. Income tax is something that can hardly be avoided by a profit-making company. You might find filling-in the tax return a demanding task because everything must be correct – otherwise you are asking for penalties from your … Read more
Last week I published an article with summary of the standard IAS 12 on Income taxes. It’s not an easy text to read and some definitions in IAS 12 are so obscure that many people grope in the fog unsure what to do. When it comes to setting the tax base of assets or liabilities, … Read more
Did you know that the world-wide economic crisis followed by the recession caused a sharp downfall of assets’ prices? In some countries, the prices of property fell by 30-50%! Such a steep and fast decrease had an impact on the IFRS financial reporting, too. Companies showing assets in their accounts had to reassess their book … Read more
Business world as of today presents a huge amount of various risks to almost every company or entrepreneur. I’m sure that also your company faces at least some of these risks: foreign currency risk, price risk, inflation risk, credit risk – just name it. Many businesses decided to do something about these risks and started … Read more
Does your company remunerate its top management by granting them own shares? Or, do employees receive bonuses based on the increase of the company’s share price? Transactions whereby companies pay for the goods or services received by issuing shares or similar instruments are very common in these days. In fact, their volume is rapidly … Read more
The year 2013 started off with some really significant IFRS amendments that you need to take into account when preparing your IFRS financial statements as at 31 December 2013. Although these changes should be applied in the year 2013 for the first time, you also need to restate your comparative figures for the previous reporting … Read more
Do you work in the production company? And did you find out that some of your production assets are still in operation but they were fully depreciated? In this case, the original estimate of machinery’s useful life proved to be incorrect. Here’s one of the questions I received: “Dear Silvia, we are a manufacturing company. … Read more
Ignoring an accrual principle??? What?! No way! That’s the basic accounting rule we should all follow! Yes, of course, you’re right. BUT: There IS an exception. The statement of cash flows. Preparing the statement of cash flows might become the biggest accountant’s nightmare. Why is that? Because the statement of cash flows is THE ONLY … Read more