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Tax depreciation rates differ from IFRS depreciation rates in their purpose, so don't depend heavily on tax rates. I doubt that this specific asset class has been analysed in terms of accounting depreciation rates. But you need to estimate an entity-specific useful life anyway. For example, a luxury...

I've moved this topic to 'General accounting and financial reporting discussion'. Please don't post general questions under 'IFRS-related topics', thanks!

I'm reconsidering my position Given that money is fungible, I agree with DJP's view. You should recognise these funds as cash for a day. The accounting would likely be DR Cash / CR Liabilities upon receipt, followed by DR Liabilities / CR Cash when routing them to client accounts.

No, it's simply an expense incurred in providing the service.

If the use of these funds is contractually predetermined and they are transferred to client accounts within a day, it seems there's no control or benefit for the corporation.

Could you clarify what is meant by 'change in nature of use'? Classifying it as inventory may not be accurate. It could be more appropriate to consider it as an asset held for sale as per IFRS 5, or as an investment property in line with IAS 40.

If AIM is considered an active market, then IFRS 13.80 applies, so you wouldn't be able to use Level 2/3 inputs.

See https://ifrscommunity.com/knowledge-bas ... uity-swaps

Depending on the specific circumstances, lease modifications can either be accounted for as a new lease or an adjustment to the pre-existing lease. See https://ifrscommunity.com/knowledge-bas ... fications/

Children and spouses are close family members under IAS 24.9

Can you provide more details on the nature of the arrangement and recharged expenses, Nowim?

Do either of you know if AIM is regarded as an active market? I.e. 'a market in which transactions for the asset take place with sufficient frequency and volume to provide pricing information on an ongoing basis.'

The best resource IMO: https://www.ifrs.org/content/dam/ifrs/p ... r-2020.pdf

Hi Hassen, looking forward to your contributions to the community

These companies are related, because Mr Y controls B and his close family member is a member of the key management personnel of A (IAS 24.9(b)(vii)).

yes:
https://ifrscommunity.com/knowledge-bas ... -buildings

PS. Please use more descriptive topic titles, 'IAS 40' was too generic!

... and of our knowledge base?

https://ifrscommunity.com/knowledge-bas ... ated-party

How do you think the parent will realise the DTA arising on its investment in the subsidiary?

The FICE ED aims to address this types of scenarios:
https://www.ifrs.org/content/dam/ifrs/p ... df#page=14

It seems that you're confusing realisation of deferred tax assets (DTA) by the subsidiary and the parent. It's the *parent* that potentially recognises DTA for the temporary difference arising on the investment, so you should be looking at: - availability of taxable income of the *parent*, and - whe...

I find the scenario confusing to be honest. B acquires A, but we don't know from whom. And as part of consideration, A (the acquiree!) provides services to B (the acquirer)...

For this transaction to be in scope of IFRS 15, there also must be a customer which is defined as a party that enters into a contract with an entity to obtain goods or services resulting from the entity’s ordinary activities, in return for a consideration (IFRS 15.6).

Just had a quick look, but please have a look at the section below, does it answer the question?

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

IAS 16 for sure, you're running a golf course business

Moving to appropriate forum

It is a change in accounting policy but its impact must be immaterial by definition and hence applied prospectively. If the impact isn't immaterial, then you shouldn't have this policy in the first place because IAS 16 / IAS 38 don't have any practical expedient regading capitalisation threshold.

Not really

Which solution worked best for you then?

When applying this exception, Level 3 disclosures aren't necessary since there's no fair value measurement recognised at the reporting date. Regarding the convertible instruments you're considering, would it be reasonable to assume that their cost approximates their fair value even after 12 months?

I'm not saying that this isn't the commonly accepted practice. In the case of public companies, it's different because their final results are deemed market-sensitive information. My focus was more on the audits of privately owned companies.