Search found 234 matches

by exIFRS
11 Jan 2024, 18:18
Forum: IFRS-related topics
Topic: IAS 12
Replies: 4
Views: 1280

Re: IAS 12

Good call. I forgot about the exemption for non business combinations. Ignore me (we can all have a bad day 😁)
by exIFRS
11 Jan 2024, 15:47
Forum: IFRS-related topics
Topic: IAS 12
Replies: 4
Views: 1280

Re: IAS 12

IAS12 Para 7: The tax base of an asset is the amount that will be deductible for tax purposes against any taxable economic benefits that will flow to an entity when it recovers the carrying amount of the asset. If those economic benefits will not be taxable, the tax base of the asset is equal to its...
by exIFRS
10 Jan 2024, 09:59
Forum: IFRS-related topics
Topic: IFRS 16 - definition of "stand alone price"
Replies: 2
Views: 492

Re: IFRS 16 - definition of "stand alone price"

Paragraph 14 of IFRS 16 is key here "The relative stand-alone price of lease and non-lease components shall be determined on the basis of the price the lessor, or a similar supplier, would charge an entity for that component, or a similar component, separately. If an observable stand-alone pric...
by exIFRS
25 Nov 2023, 08:48
Forum: IFRS-related topics
Topic: Calculating the average rate of depreciation
Replies: 24
Views: 2607

Re: Calculating the average rate of depreciation

Then yes that’s how I would have done it.
by exIFRS
25 Nov 2023, 08:36
Forum: IFRS-related topics
Topic: Bonus issue
Replies: 5
Views: 851

Re: Bonus issue

Even if it’s in lieu of a cash dividend my vague memory is it is still a net zero transaction? But it has been ages. I thought the view was a bonus issue (on the assumption it is going to all shareholders on a proportionate basis) is dilutive, ie reduced the value of the existing shares, by exactly ...
by exIFRS
25 Nov 2023, 08:29
Forum: IFRS-related topics
Topic: Calculating the average rate of depreciation
Replies: 24
Views: 2607

Re: Calculating the average rate of depreciation

I am not sure whether your use of “ca” is a currency signifier or stands for carrying amount (ie cost less accumulated depreciation). To calculate average useful life I would have used cost (not carrying amount) plus half the purchases less disposals during the year. Carrying amount (etc) divided by...
by exIFRS
15 Nov 2023, 14:59
Forum: IFRS-related topics
Topic: IFRIC Question: Net Zero Commitments
Replies: 2
Views: 467

IFRIC Question: Net Zero Commitments

An interesting question has gone to the IFRS Interpretations Committee: This submission therefore requests that the Interpretations Committee consider the interpretations that: 1. A Net Zero Transition Commitment meets the definition of a constructive obligation under IAS37 paragraphs 10 and 20, and...
by exIFRS
07 Nov 2023, 17:46
Forum: IFRS-related topics
Topic: Costs to sell ' under IAS 41 ' Agriculture"
Replies: 8
Views: 1257

Re: Costs to sell ' under IAS 41 ' Agriculture"

My interpretation would be that the incremental costs should be measured as if you were to sell in to the market. This feels like the only consistent interpretation of the sentence as a whole. Also if you look at the definition "Costs to sell are the incremental costs directly attributable to t...
by exIFRS
06 Nov 2023, 17:08
Forum: IFRS-related topics
Topic: Classification of non-current liabilities as current
Replies: 5
Views: 1262

Re: Classification of non-current liabilities as current

This is not correct. IAS 1.69: "An entity shall classify a liability as current when: ... (d) it does not have the right at the end of the reporting period to defer settlement of the liability for at least twelve months after the reporting period... An entity shall classify all other liabilitie...
by exIFRS
30 Oct 2023, 20:40
Forum: General accounting and financial reporting discussion
Topic: Deferred Income Tax
Replies: 17
Views: 3752

Re: Deferred Income Tax

Yes, hypothetically there would be a deferred tax liability. There are two ways to understand it, the balance sheet way and the income statement way. Story time (feel free to skip the next couple of paragraphs). **************************************************************************** When I was ...
by exIFRS
30 Oct 2023, 16:23
Forum: General accounting and financial reporting discussion
Topic: Deferred Income Tax
Replies: 17
Views: 3752

Re: Deferred Income Tax

I would say this doesn't sound like an active market: "A market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.". A yearly average doesn't sound like pricing information on an ongoing basis...
by exIFRS
30 Oct 2023, 14:27
Forum: General accounting and financial reporting discussion
Topic: Deferred Income Tax
Replies: 17
Views: 3752

Re: Deferred Income Tax

[Grabs some popcorn]
by exIFRS
20 Oct 2023, 08:10
Forum: IFRS-related topics
Topic: Significant influence assessment
Replies: 6
Views: 801

Re: Significant influence assessment

I am with JRSB on this one. IAS 28.3 states "Significant influence is the power to participate in the financial and operating policy decisions of the investee". A key element is that you do not have to exercise the power, it just has to exist. Sitting at the Board table is usually a pretty...
by exIFRS
17 Oct 2023, 20:31
Forum: IFRS-related topics
Topic: Accounting for agreements on land use.
Replies: 8
Views: 34586

Re: Accounting for agreements on land use.

I think this is one of those times we are going to have to agree to disagree. I don't think constructing a building, using it, and 20 years later handing it over is ordinary business for a developer. As for the lease, I am leasing out the land, not the building. The developer gets control of the lan...
by exIFRS
16 Oct 2023, 20:19
Forum: IFRS-related topics
Topic: IFRS 9 Payables and Receivables
Replies: 3
Views: 2511

Re: IFRS 9 Payables and Receivables

I agree with Ketan, there isn't enough information here to understand the economic substance, and therefore it is not possible to untangle the arrangement.
by exIFRS
15 Oct 2023, 19:14
Forum: IFRS-related topics
Topic: Accounting for agreements on land use.
Replies: 8
Views: 34586

Re: Accounting for agreements on land use.

I agree it is a mess. Marek, I can see how you could get to IFRS 15 for the "sale of the buildings". I flirted with this too. But it seems to my that IFRS 16 trumps IFRS 15. That is the scope of IFRS 15 explicitly excludes things captured by IFRS 16 (so if we agree IFRS 16 applies, IFRS 15...
by exIFRS
15 Oct 2023, 18:35
Forum: IFRS-related topics
Topic: Redeemable preference shares
Replies: 25
Views: 156677

Re: Redeemable preference shares

Thanks Leo. Honestly I don't see how you even get to Q5. Your answer to Q1 surely has to be yes. You have a liability as per 32.11(a) You have to either hand over cash or a financial instrument (shares in the parent). Either of these is "unfavourable" as given the choice you would rather n...
by exIFRS
12 Oct 2023, 08:12
Forum: IFRS-related topics
Topic: Redeemable preference shares
Replies: 25
Views: 156677

Re: Redeemable preference shares

My "I" key was broken so I could only write FRS and that would just be confusing.
by exIFRS
11 Oct 2023, 21:05
Forum: IFRS-related topics
Topic: Accounting for agreements on land use.
Replies: 8
Views: 34586

Re: Accounting for agreements on land use.

On the surface it sounds a lot like "A contract that conveys the right to use an asset [the land] for a period of time in exchange for consideration [the eventual transfer of the buildings]." which is the definition of a lease. And hence IFRS 16 applies. But I would want to really understa...
by exIFRS
10 Oct 2023, 21:02
Forum: IFRS-related topics
Topic: Redeemable preference shares
Replies: 25
Views: 156677

Re: Redeemable preference shares

I realise I am coming in late, so maybe I am misunderstanding the question. AS I think you have concluded in either case it is a liability from B's perspective. You either have to settle in cash or another financial asset (A's shares). If the questions is about the accounting from B's perspective, i...
by exIFRS
23 Apr 2022, 11:02
Forum: IFRS-related topics
Topic: Capitalization of legal fees
Replies: 13
Views: 7409

Re: Capitalization of legal fees

I would be very careful extrapolating the Agenda Decision. The key fact in the Agenda Decision is (emphasis added) "The tax deposit gives the entity a right to obtain future economic benefits, either by receiving a cash refund or by using the payment to settle the tax liability. The nature of t...
by exIFRS
23 Apr 2022, 10:23
Forum: IFRS-related topics
Topic: IFRS for SMEs Amendments
Replies: 5
Views: 2011

Re: IFRS for SMEs Amendments

The IASB are currently undertaking a "comprehensive review" of the 2015 IFRS for SMEs (its second review of the standard). The current work plan suggests that an Exposure Draft of a new Standard will be exposed in Q3 2022. But for now the 2015 standards are the ones to use. If you are inte...
by exIFRS
01 Mar 2022, 13:15
Forum: IFRS-related topics
Topic: IFRS 15 (?) - cost of free gift
Replies: 7
Views: 5137

Re: IFRS 15 (?) - cost of free gift

Remember a "free gift" still counts as a performance obligation, and therefore needs to be valued and recognised separately. https://ifrscommunity.com/knowledge-base/ifrs-15-performance-obligations-and-timing-of-revenue-recognition/ See also: https://www.bdo.com.au/en-au/insights/retail/ar...
by exIFRS
25 Feb 2022, 13:34
Forum: IFRS-related topics
Topic: IFRS 15 (?) - cost of free gift
Replies: 7
Views: 5137

Re: IFRS 15 (?) - cost of free gift

Inventory must be recorded at lower of cost or sales value. You would need to impair inventory first.
by exIFRS
15 Feb 2022, 10:03
Forum: IFRS-related topics
Topic: Machine depreciation : ready to use but not used
Replies: 11
Views: 4294

Re: Machine depreciation : ready to use but not used

I think the key paragraphs are in the basis for conclusions to IAS 16 specifically: BC30: The Board decided that the useful life of an asset should encompass the entire time it is available for use, regardless of whether during that time it is in use or is idle. Idle periods most commonly occur just...
by exIFRS
27 Jan 2022, 20:24
Forum: IFRS-related topics
Topic: IFRS 15 Loyalty points
Replies: 20
Views: 4653

Re: IFRS 15 Loyalty points

Do the accounting right and the free coffees can be your
most profitable 😁
by exIFRS
21 Jan 2022, 09:24
Forum: IFRS-related topics
Topic: PPE- building or machinery
Replies: 5
Views: 2754

Re: PPE- building or machinery

Yeah, I understand where you are coming from. And if the costs had not added value to the factory, but had been necessary (I have seen examples where a roof had to be removed and then replaced to allow a machine to be dropped by crane into the building) then those would be capitalised to the machine...
by exIFRS
21 Jan 2022, 09:02
Forum: IFRS-related topics
Topic: PPE- building or machinery
Replies: 5
Views: 2754

Re: PPE- building or machinery

I would think primarily about which item the useful life is more closely tied to. And I am suspecting it is the building. If the use of the factory changes I assume those works would still add value to the building as a whole. I would only link to the machine if the works only added value while that...
by exIFRS
28 Nov 2021, 11:30
Forum: IFRS-related topics
Topic: ED: Non-current Debts with Covenants - First of Many Questions
Replies: 11
Views: 5200

Re: ED: Non-current Debts with Covenants - First of Many Questions

I am still curious what people think about the creation of a whole new category of liabilities on the face of the Statement of Financial Position.
by exIFRS
26 Nov 2021, 18:19
Forum: IFRS-related topics
Topic: ED: Non-current Debts with Covenants - First of Many Questions
Replies: 11
Views: 5200

Re: ED: Non-current Debts with Covenants - First of Many Questions

Like I say I don't disagree with the value argument, so let's put that aside. I hear what you are saying about the materiality of a covenant. But then I wonder how we ended up where we are, there was already a requirement to disclose material covenants, as demonstrated by the Practice Statement Quot...