Search found 60 matches
- 29 Dec 2020, 10:59
- Forum: IFRS-related topics
- Topic: Interest-free loans or loans at below-market interest rate
- Replies: 9
- Views: 83
Re: Interest-free loans or loans at below-market interest rate
Right, things can get blurred under common control. I guess you have two choices in such a case: 1. Treat such a loan as repayable on demand and therefore proceeds = fair value or 2. Consider the loan to be in substance equity contribution in full What are your observations in practice? Mostly no. ...
- 21 Oct 2020, 12:49
- Forum: IFRS-related topics
- Topic: Contribution to joint operation
- Replies: 20
- Views: 168
Re: Contribution to joint operation
On second thought my idea doesn't make sense. You should continue with the approach you are currently using.
- 21 Oct 2020, 12:43
- Forum: IFRS-related topics
- Topic: Inventories at cost and NRV
- Replies: 3
- Views: 44
Re: Inventories at cost and NRV
Well the original cost was 100 so you should write it back up to 100, provided the NRV is at 100 or above 100.
- 21 Oct 2020, 12:41
- Forum: IFRS-related topics
- Topic: offsetting receivable and lease liability
- Replies: 7
- Views: 65
Re: offsetting receivable and lease liability
What @JRSB said, it depends on whether there is a legal enforceable right to settle. Usually any receivables / prepayments on date of adoption of IFRS 16 form part of right-of-use asset as opposed to being netted off against lease liability.
- 21 Oct 2020, 12:38
- Forum: IFRS-related topics
- Topic: Contribution to joint operation
- Replies: 20
- Views: 168
Re: Contribution to joint operation
I personally like to keep things simple. Why not treat it simply as an advance and treat the receipt of excess as settlement of this advance.
- 21 Oct 2020, 08:43
- Forum: IFRS-related topics
- Topic: Selling 50% of a level of consolidation
- Replies: 6
- Views: 114
Re: Selling 50% of a level of consolidation
When you classify a line of business or subsidiary as held for sale you classify all its assets (current and non current) in a separate line after current assets as assets held for sale and the liabilities are classified as held for sale in a separate line after current liabilities. You could either...
- 30 Sep 2020, 08:34
- Forum: IFRS-related topics
- Topic: Derivative transaction double entries
- Replies: 12
- Views: 85
Re: Derivative transaction double entries
You do not have to recognize the asset and liabilities with respect to the notional amount of the derivative. What you carry on your balance sheet is the fair value of the derivative (which is net of receive and pay legs). In absence of any hedge accounting, the fair value changes go to P&L and the ...
- 16 Sep 2020, 14:52
- Forum: IFRS-related topics
- Topic: Best Free Resource for learning IFRS
- Replies: 3
- Views: 69
Re: Best Free Resource for learning IFRS
Plenty of videos available on youtube as well. Bottom line is it is not practical to get thorough understanding of all IFRSs by just reading through the text or watching videos. I would suggest targeted research in areas of IFRS which you encounter in practical life.
- 16 Sep 2020, 14:49
- Forum: IFRS-related topics
- Topic: Practical approaches to lease term under IFRS 16
- Replies: 6
- Views: 284
Re: Practical approaches to lease term under IFRS 16
I think it's more a question of substance over form and that's what makes the whole thing a bit subjective. No entity would make investments in furniture, fixtures and fittings with the intention of abandoning the premises within 12 months. We generally look at the underlying useful life of assets o...
- 31 Aug 2020, 15:13
- Forum: IFRS-related topics
- Topic: IFRS 16 Covid rent concessions
- Replies: 20
- Views: 252
Re: IFRS 16 Covid rent concessions
IFRS as approved by IASB.
- 31 Aug 2020, 14:34
- Forum: IFRS-related topics
- Topic: IFRS 16 Covid rent concessions
- Replies: 20
- Views: 252
Re: IFRS 16 Covid rent concessions
This statement is interesting: 'Where companies use the reliefs permitted by the IFRS 16 amendment, they are expected to disclose this in the notes to their financial statements.' I thought there will rather a 'don't ask, don't tell' approach with materiality considerations in the background We pre...
- 31 Aug 2020, 09:24
- Forum: IFRS-related topics
- Topic: IFRS 16 for small Airlines with all dry operating leases
- Replies: 2
- Views: 50
Re: IFRS 16 for small Airlines with all dry operating leases
Why are you using LIBOR to discount the lease rentals? IFRS 16 requires the entity to use incremental borrowing rate (if implicit rate of return is not available). I am pretty sure any entity (specially one in Pakistan and that too in aviation industry) would be able to borrow at LIBOR. Second, you ...
- 03 Aug 2020, 16:39
- Forum: IFRS-related topics
- Topic: Impairment of subsidiary
- Replies: 7
- Views: 124
Re: Impairment of subsidiary
Exactly as @jonyicheng said, when you are performing consolidation you reverse the impairment against i.e. credit Retailed earnings / impairment charge and debit the investment in subsidiary and then the investment in subsidiary is eliminated against share capital / pre-acquisition reserves of the s...
- 18 Jul 2020, 18:16
- Forum: General accounting and financial reporting discussion
- Topic: Disposal of subsidiary
- Replies: 7
- Views: 222
Re: Disposal of subsidiary
I am confused, PPA exercise is from buyer perspective and is basically allocation of consideration paid to different line items within the balance sheet. Usually, seller has nothing to do with PPA allocation. This seems more like a case of contingent consideration, which should have been accounted f...
- 18 Jul 2020, 18:09
- Forum: IFRS-related topics
- Topic: IFRS 16 Covid rent concessions
- Replies: 20
- Views: 252
Re: IFRS 16 Covid rent concessions
Earlier adoption is also permissible as per IASB thought the constraint seems to be from EU regulator it seems.
- 13 Jul 2020, 17:52
- Forum: IFRS-related topics
- Topic: Treatment of professional fees paid to raise capital
- Replies: 16
- Views: 203
Re: Treatment of professional fees paid to raise capital
The fact that it is a monthly fee is just a matter and question payment terms negotiated. The standard looks at costs which are incidental to equity issuance and I feel these are. If you were not going to raise this equity (regardless of whether it will be successful or not) you would not have incur...
- 13 Jul 2020, 10:58
- Forum: IFRS-related topics
- Topic: IFRS - Investment Properties
- Replies: 7
- Views: 73
Re: IFRS - Investment Properties
IAS 40 allows you to carry investment properties on cost basis as well.
- 13 Jul 2020, 10:55
- Forum: IFRS-related topics
- Topic: IFRS 16 - Lessor accounting
- Replies: 5
- Views: 106
Re: IFRS 16 - Lessor accounting
Nope, when it comes to other systematic basis you have to come up with an alternative systematic basis (same as if you are not following straight line depreciation you have to come up with an alternative). Where escalation clauses are built in a contract these have to be straight lined.
- 12 Jul 2020, 09:10
- Forum: IFRS-related topics
- Topic: IFRS 16 sub lease
- Replies: 11
- Views: 136
Re: IFRS 16 sub lease
Without a contract, what is the basis of payment between Company Y and Company X?
- 12 Jul 2020, 09:03
- Forum: IFRS-related topics
- Topic: Treatment of professional fees paid to raise capital
- Replies: 16
- Views: 203
Re: Treatment of professional fees paid to raise capital
I would even take the monthly fee to equity (in case company was successful in raising the capital). The question is on incremental, not on whether the equity round would be successful or unsuccessful. If the company was not going ahead with the decision to raise capital, they would not have incurre...
- 12 Jul 2020, 08:59
- Forum: IFRS-related topics
- Topic: IFRS 16 - Lessor accounting
- Replies: 5
- Views: 106
Re: IFRS 16 - Lessor accounting
Yes your understanding is correct, the difference between what is to be received in cash and what is recognized in the income statement is recognized as an asset on the balance sheet (you will need to bifurcate it between current and non current as well) and this will automatically decline (by way o...
- 12 Jul 2020, 08:48
- Forum: IFRS-related topics
- Topic: Do trade and other receivables/payables include non-financial accruals and deferrals?
- Replies: 3
- Views: 137
Re: Do trade and other receivables/payables include non-financial accruals and deferrals?
There is no standard guideline as such and depends on the materiality of the amounts in question. However, if you include say non financial liabilities within trade and other payables line item then the nomenclature needs to be revised to trade payables and other liabilities. Again, no strict requir...
- 07 Jul 2020, 08:40
- Forum: After hours
- Topic: Questions to refresh oneself
- Replies: 9
- Views: 764
Re: Questions to refresh oneself
Plenty of videos available on Youtube as well, the knowledge base on IFRS community is good. I have also seen people using IFRS box (geared towards beginners).
- 01 Jul 2020, 11:57
- Forum: IFRS-related topics
- Topic: IFRS 16 Lessee Involment before the lease
- Replies: 8
- Views: 104
Re: IFRS 16 Lessee Involment before the lease
I think there is a case for it to be capitalized as leasehold improvement. If as a result of the delay the cost no longer holds its value then it should be written off to P&L.
- 17 Jun 2020, 19:24
- Forum: IFRS-related topics
- Topic: Loan to Equity
- Replies: 7
- Views: 87
Re: Loan to Equity
You don't need to issue new shares to convert a shareholder loan to equity. Depending on the jurisdiction, a simple agreement between the shareholder (Holding company) and the borrower can convert the loan to equity, in form of shareholder contribution.
- 17 Jun 2020, 17:15
- Forum: After hours
- Topic: article on IFRIC23
- Replies: 15
- Views: 277
Re: article on IFRIC23
Thanks Marek, appreciate the feedback.
I would definitely consider mailing lists (have used mail chimp in past) but I need to be regularly writing on the blog for it any sort of newsletter / mail to be of any value.
I would definitely consider mailing lists (have used mail chimp in past) but I need to be regularly writing on the blog for it any sort of newsletter / mail to be of any value.
- 17 Jun 2020, 09:17
- Forum: IFRS-related topics
- Topic: IFRS 16 - Lessor Interest Income Recognition and Accrual
- Replies: 4
- Views: 37
Re: IFRS 16 - Lessor Interest Income Recognition and Accrual
Simply put, you start recognizing interest from the date you recognized the net investment in lease. The only bearing the date and amount of rental amount has on interest is the amount on which interest is calculated.
- 16 Jun 2020, 22:00
- Forum: IFRS-related topics
- Topic: IFRS 16 - Leases (Parent- Subsidiary) recognition and measurement.
- Replies: 7
- Views: 152
Re: IFRS 16 - Leases (Parent- Subsidiary) recognition and measurement.
We have this case where our investment properties are also leased out to retail units within the group (in addition to leasing them to third party tenants as well). As a consequence, we reverse out all the balances pertaining to the intergroup leases and eliminate lease income against depreciation o...
- 16 Jun 2020, 14:08
- Forum: IFRS-related topics
- Topic: Transfer of assets to a wholly owned subsidiary
- Replies: 14
- Views: 92
- 16 Jun 2020, 12:32
- Forum: IFRS-related topics
- Topic: IAS 2 inventories - Letter of Credit
- Replies: 11
- Views: 106
Re: IAS 2 inventories - Letter of Credit
What I was referring to was retail inventory, so there is no capitalization period as such. I understand that if I was importing material to construct real estate inventory etc. then yes, this cost would be eligible for capitalization.