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Hi, I think that the only “provision” results from expected credit losses (ECL) under IFRS 9. The provision under IAS 37 should be recognised only if the contract with customer becomes onerous, but in most cases I think that ECL provision should be enough. ECL are recognised as an expense. Off-balan...

Hi, an interesting case! I would recognise them as a one-off credit to profit or loss. There is no basis to defer their recognition in P/L in my opinion. What do you think?

Something tells me you didn't even bother to look into the knowledge base

https://ifrscommunity.com/knowledge-bas ... rrangement

Feel free to come back with specific questions

As I understand it, a limited company should be separate from its owner when it comes to assets and liabilities. Let's think about it this way: if you were to prepare two sets of financial statements : 1/ of the owner and 2/ of the entity - where would you show this property as an asset and why? Who...

No, the mere fact that the cash flows go through an entity does not mean control, even when taking substance over form. Important IFRS question here is whether the entity (taken separately from its owner) has the ability to direct the use of the property.

Hi, this is unusual, normally there should be a clear distinction between assets of a limited company and their owners. If the entity has no legal/ contractual right to the property, I would say that the entity does not control the property. How can the entity direct the significant activities relat...

yes, this results directly from the definition of a related party, and is further explained in basis for conclusions to IAS 24 (par. BC50-BC52)

Hi,

no, it works the other way around, see here:

https://ifrscommunity.com/knowledge-bas ... iabilities

M.

I'm not sure I understand your question. Can you please explain what you mean with a simple example?

So this discussion would be much more interesting if he joined us

So this is a regular service with gross revenue and expenses to be recognised by the letting agent, I'm not even sure whether there are any doubts here

So I understand that the letting agent decides what needs to be repaired, by whom and for what price. The letting agent also directs the work of subcontractors? If so, the letting agent is a principal in my opinion.

Hi, this is a principal vs. agent question and a little more information is needed. Have a look at this section in the knowledge base: https://ifrscommunity.com/knowledge-base/ifrs-15-specific-application-points/#principal-vs-agent-considerations It contains references to IFRS 15 where you'll find m...

Hi, investments in JV were then accounted for under IAS 31, now under IFRS 11. Initial recognition is at cost. The only judgement I see here is the question of whether the land was already transferred to JV at the reporting date. Mehranmichail wrote that JV was not even properly incorporated, so it’...

Cash is a financial asset for sure. The question here was whose asset it was. But I'm pretty sure that the agent should recognise cash assets from what you've written.

Sure, fair value does not have to be based on quoted prices in this case.

Have a look here:
https://ifrscommunity.com/knowledge-bas ... -hierarchy

But calculation of the appropriate discount rate will still be a challenge.

Re. measurement: have a look here a tell us how this applies to your case, why this instrument is interest free? https://ifrscommunity.com/knowledge-base/ifrs-9-measurement-of-financial-instruments/#below-market-interest-rate-loans re. classification: have a look here: https://ifrscommunity.com/know...

Hi, I agree with you, point 1. makes it clear to me that the money on this bank account should be recognised as an asset of the agent. We can consider two scenarios to explore this further: 1/ Tenants made their transfers to this bank account, but the bank goes bankrupt and the agent did not manage ...

No, you need to carefully read the references in this paragraph. It takes a while to digest it :) Paragraph IAS 24.9(b)(vii) reads: A person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the entity. So it refers to (a)(i) ONLY and (a...

Hi, in my opinion there are no conflicting paragraphs when it comes parties related through key management personnel. Two entities are not related merely because they share a member of key management personnel. In which paragraph IAS 24 states otherwise in your opinion?

frankly speaking, I don't see any justification for presenting this property as an investment in JV

Maybe the agreement for purchase of the land was structured so that it was never an asset of the reporting entity. Well, it seems we need much more information about so-called facts and circumstances if you’d like to discuss it.

Hi

I would say that as an asset held for sale under IFRS 5, based on paragraphs IFRS 5.11 and IFRS 5.10.

What was your conclusion?

Hi Gibby, first of all – welcome to the Forum, I hope we’ll have many fruitful discussions here :) To be honest, I’m not an optimist in this area, I think that the diversity in practice is here to stay. The IASB research project on discount rates in IFRS was launched many years ago, so IFRS 16 could...

I agree with your analysis. The intermediate lessor clearly acts as a principal in this transaction. If it accounts for the head lease using the practical expedient for short-term leases, then the sublease is an operating lease (IFRS 16.B58). So the expense of GBP 1,000 and income of GBP 1,200 are r...

Hi, I would tackle this matter in two steps: 1/ Consider whether the intermediate party (landlord) is a principal or an agent - it's best done by applying IFRS 15 principal vs agent considerations This would determine the net vs gross presentation of lease income. 2/ Then look at IFRS 16 requirement...

Hi, this would be against IFRS in my opinion. Under IFRS 16.67, lessor recognises a lease when an underlying asset is made available for use by a lessee (the commencement date). This approach is also consistent with general approach to executory contracts under IFRS – you don’t recognise anything wh...

I'm happy to see that you found this example useful. For quarterly payments, all you need to do is to change the formulas for discounting factors and discounting expense. As other users may find it useful, I prepared a variation of this example which is now available in this excel file , does it ans...

First of all, well done on the forum and the website! thanks :) Regarding CPI-linked payments - from digging in Basis for Conclusions (BC 166) I understand that interest rate should be nominal. OK so we agree that this should be a nominal interest rate. In the reports of similar companies, I see a ...

Hi, this is a point that is high on my list when it comes to expanding the knowledge base:) I hope we will see other people sharing their approaches to this matter on this forum, but probably it is at a too early stage of development yet. As I talked to my colleagues offline, they mostly adopt a sim...