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  • IFRS for Small and Medium-Sized Entities (IFRS for SMEs)
    are described Basic financial assets and liabilities are generally measured at amortised cost Other financial assets and liabilities are generally measured at fair value through profit or loss Non financial assets are generally measured using a cost based measure Non financial liabilities are generally measured at settlement amount Section 2 includes pervasive recognition and measurement principles Source of guidance if a specific issue is not addressed in the IFRS for SMEs see Section 10 Concepts of profit or loss and total comprehensive income Offsetting of assets and liabilities or of income and expenses is prohibited unless expressly required or permitted undue cost or effort added by 2015 Amendments to the IFRS for SMEs issued on 21 May 2015 effective 1 January 2017 Section 3 Financial Statement Presentation Fair presentation presumed to result if the IFRS for SMEs is followed may be a need for supplemental disclosures State compliance with IFRS for SMEs only if the financial statements comply in full Does include true and fair override but this should be extremely rare IFRS for SMEs presumes the reporting entity is a going concern SMEs shall present a complete set of financial statements at least annually At least one year comparative prior period financial statements and note data Presentation and classification of items should be consistent from one period to the next Must justify and disclose any change in presentation or classification of items in financial statements Materiality an omission or misstatement is material if it could influence economic Complete set of financial statements Statement of financial position Either a single statement of comprehensive income or two statements an income statement and a statement of comprehensive income Statement of changes in equity Statement of cash flows Notes If the only changes to equity arise from profit or loss payment of dividends corrections of errors and changes in accounting policy an entity may present a single combined statement of income and retained earnings instead of the separate statements of comprehensive income and of changes in equity see Section 6 An entity may present only an income statement no statement of comprehensive income if it has no items of other comprehensive income OCI The only OCI items under the IFRS for SMEs are Some foreign exchange gains and losses relating to a net investment in a foreign operation see Section 30 Some changes in fair values of hedging instruments in a hedge of variable interest rate risk of a recognised financial instrument foreign exchange risk or commodity price risk in a firm commitment or highly probable forecast transaction or a net investment in a foreign operation see Section 12 Some actuarial gains and losses see Section 28 Section 4 Statement of Financial Position May still be called balance sheet Current non current split is not required if the entity concludes that a liquidity approach produces more relevant information Some minimum line items required These include Cash and equivalents Receivables Financial assets Inventories Property plant and equipment Investment property at cost Investment property at fair value Intangible assets Biological assets at cost Biological assets at fair value Investment in associates Investment in joint ventures Payables Financial liabilities Current tax assets and liabilities Deferred tax assets and liabilities Provisions Non controlling interest Equity of owners of parent And some required items may be presented in the statement or in the notes Categories of property plant and equipment Information about assets with binding sale agreements Categories of receivables Categories of inventories Categories of payables Employee benefit obligations Classes of equity including OCI and reserves Details about share capital Sequencing format and titles are not mandated added by 2015 Amendments to the IFRS for SMEs issued on 21 May 2015 effective 1 January 2017 Section 5 Statement of Comprehensive Income and Income Statement One statement or two statement approach either a single statement of comprehensive income or two statements an income statement and a statement of comprehensive income Must segregate discontinued operations Must present profit or loss subtotal if the entity has any items of other comprehensive income Bottom line profit or loss in the income statement and total comprehensive income in the statement of comprehensive income is before allocating those amounts to non controlling interest and owners of the parent No item may be labelled extraordinary But unusual items can be separately presented Expenses may be presented by nature depreciation purchases of materials transport costs employee benefits etc or by function cost of sales distribution costs administrative costs etc either on face of the statement of comprehensive income or income statement or in the notes Single statement of comprehensive income Revenue Expenses showing separately finance costs profit or loss from associates and jointly controlled entities tax expense discontinued operations Profit or loss may omit if no OCI Items of other comprehensive income Total comprehensive income may label Profit or Loss if no OCI Separate statements of income and comprehensive income Income Statement Bottom line is profit or loss as above Statement of Comprehensive Income Begins with profit or loss Shows each item of other comprehensive income Bottom line is Total Comprehensive Income Section 6 Statement of Changes in Equity and Statement of Comprehensive Income and Retained Earnings Shows all changes to equity including total comprehensive income owners investments dividends owners withdrawals of capital treasury share transactions Can omit the statement of changes in equity if the entity has no owner investments or withdrawals other than dividends and elects to present a combined statement of comprehensive income and retained earnings Section 7 Statement of Cash Flows Presents information about an entity s changes in cash and cash equivalents for a period Cash equivalents are short term highly liquid investments expected to be converted to cash in three months held to meet short term cash needs rather than for investment or other purposes Cash flows are classified as operating investing and financing cash flows Option to use the indirect method or the direct method to present operating cash flows Interest paid and interest and dividends received may be operating investing or financing Dividends paid may be operating or investing Income tax cash flows are operating unless specifically identified with investing or financing activities Separate disclosure is required of some non cash investing and financing transactions for example acquisition of assets by issue of debt Reconciliation of components of cash Section 8 Notes to the Financial Statements Notes are normally in this sequence Basis of preparation ie IFRS for SMEs Summary of significant accounting policies including Information about judgements Information about key sources of estimation uncertainty Supporting information for items in financial statements Other disclosures Comparative prior period amounts are required by Section 3 unless another section allows omission of prior period amounts Section 9 Consolidated and Separate Financial Statements Consolidated financial statements are required when a parent company controls another entity a subsidiary Control Power to govern financial and operating policies to obtain benefits More than 50 of voting power control presumed Control exists when entity owns less than 50 but has power to govern by agreement or statute or power to appoint majority of the board or power to cast majority of votes at board meetings Control can be achieved by currently exercisable options that if exercised would result in control A subsidiary is not excluded from consolidation because Investor is a venture capital organisation Subsidiary s business activities are dissimilar to those of parent or other subs Subsidiary operates in a jurisdiction that imposes restrictions on transferring cash or other assets out of the jurisdiction However consolidated financial statements are not required even if a parent subsidiary relationship exists if Subsidiary was acquired with intent to dispose within one year Parent itself is a subsidiary and its parent or ultimate parent uses IFRSs or IFRS for SMEs Must consolidate all controlled special purpose entities SPEs Consolidation procedures Eliminate intracompany transactions and balances Uniform reporting date unless impracticable Uniform accounting policies Non controlling interest is presented as part of equity Losses are allocated to a subsidiary even if non controlling interest goes negative Guidance on separate financial statements but they are not required In a parent s separate financial statements it may account for subsidiaries associates and joint ventures that are not held for sale at cost or fair value through profit and loss or using the equity method Guidance on combined financial statements but they are not required equity method added by 2015 Amendments to the IFRS for SMEs issued on 21 May 2015 effective 1 January 2017 Section 10 Accounting Policies Estimates and Errors If the IFRS for SMEs addresses an issue the entity must follow the IFRS for SMEs If the IFRS for SMEs does not address an issue Choose policy that results in the most relevant and reliable information Try to analogise from standards in the IFRS for SMEs Or use the concepts and pervasive principles in Section 2 Entity may look to guidance in full IFRSs but not required Change in accounting policy If mandated follow the transition guidance as mandated If voluntary retrospective Change in accounting estimate prospective Correction of prior period error restate prior periods if practicable Section 11 Basic Financial Instruments IFRS for SMEs has two sections on financial instruments Section 11 on Basic Financial Instruments Section 12 on Other FI Transactions Option to follow IAS 39 instead of sections 11 and 12 Even if IAS 39 is followed make Section 11 and 12 disclosures not IFRS 7 disclosures Essentially Section 11 is an amortised historical cost model Except for equity investments with quoted price or readily determinable fair value These are measured at fair value through profit or loss Scope of Section 11 includes Cash Demand and fixed deposits Commercial paper and bills Accounts and notes receivable and payable Debt instruments where returns to the holder are fixed or referenced to an observable rate Investments in nonconvertible and non puttable ordinary and preference shares Most commitments to receive a loan Initial measurement Basic financial assets and financial liabilities are initially measured at the transaction price including transaction costs except in the initial measurement of financial assets and liabilities that are measured at fair value through profit or loss unless the arrangement constitutes in effect a financing transaction A financing transaction may be indicated in relation to the sale of goods or services for example if payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate If the arrangement constitutes a financing transaction measure the financial asset or financial liability at the present value of the future payments discounted at a market rate of interest for a similar debt instrument Measurement subsequent to initial recognition Debt instruments at amortised cost using the effective interest method Debt instruments that are classified as current assets or current liabilities are measured at the undiscounted amount of the cash or other consideration expected to be paid or received ie net of impairment unless the arrangement constitutes in effect a financing transaction If the arrangement constitutes a financing transaction the entity shall measure the debt instrument at the present value of the future payments discounted at a market rate of interest for a similar debt instrument Investments in non convertible preference shares and non puttable ordinary or preference shares if the shares are publicly traded or their fair value can otherwise be measured reliably without undue cost or effort measure at fair value with changes in fair value recognised in profit or loss measure all other such investments at cost less impairment Must test all amortised cost instruments for impairment or uncollectibility Previously recognised impairment is reversed if an event occurring after the impairment was first recognised causes the original impairment loss to decrease Guidance is provided on determining fair values of financial instruments The most reliable is a quoted price in an active market When a quoted price is not available the most recent transaction price provides evidence of fair value If there is no active market or recent market transactions a valuation technique may be used Guidance is provided on the effective interest method Derecognise a financial asset when the contractual rights to the cash flows from the financial asset expire or are settled the entity transfers to another party all of the significant risks and rewards relating to the financial asset or the entity despite having retained some significant risks and rewards relating to the financial asset has transferred the ability to sell the asset in its entirety to an unrelated third party who is able to exercise that ability unilaterally and without needing to impose additional restrictions on the transfer Derecognise a financial liability when the obligation is discharged cancelled or expires Disclosures Categories of financial instruments Details of debt and other instruments Details of derecognitions Collateral Defaults and breaches on loans payable Items of income and expense undue cost or effort added by 2015 Amendments to the IFRS for SMEs issued on 21 May 2015 effective 1 January 2017 Section 12 Additional Financial Instruments Issues Financial instruments not covered by Section 11 and therefore are within Section 12 are measured at fair value through profit or loss This includes Investments in convertible and puttable ordinary and preference shares Options forwards swaps and other derivatives Financial assets that would otherwise be in Section 11 but that have exotic provisions that could cause gain loss to the holder or issuer Hedge accounting involves matching the gains and losses on a hedging instrument and hedged item It is allowed only for the following kinds of risks interest rate risk of a debt instrument measured at amortised cost foreign exchange or interest rate risk in a firm commitment or a highly probable forecast transaction price risk of a commodity that it holds or in a firm commitment or highly probable forecast transaction to purchase or sell a commodity foreign exchange risk in a net investment in a foreign operation Section 12 defines the type of hedging instrument required for hedge accounting Hedges must be documented up front to qualify for hedge accounting Section 12 provides guidance for measuring assessing effectiveness Special disclosures are required Section 13 Inventories Inventories include assets for sale in the ordinary course of business being produced for sale or to be consumed in production Measured at the lower cost and estimated selling price less costs to complete and sell Cost is determined using specific identification is required for large items option to choose FIFO or weighted average for others LIFO is not permitted Inventory cost includes costs to purchase costs of conversion and costs to bring the asset to present location and condition Inventory cost excludes abnormal waste and storage administrative and selling costs If a production process creates joint products and or by products the costs are allocated on a consistent and rational basis A manufacturer allocates fixed production overheads to inventories based on normal capacity Standard costing retail method and most recent purchase price may be used only if the result approximates actual cost Impairment write down to net realisable value selling price less costs to complete and sell see Section 27 Section 14 Investments in Associates Associates are investments where significant influence exists Significant influence is defined as the power to participate in the financial and operating policy decisions of the associate but where there is neither control nor joint control over those policies Presumption that significant influence exists if investor owns 20 or more of the voting shares Option to use Cost impairment model except if there is a published quotation then must use fair value through profit or loss Equity method investor recognises its share of profit or loss of the associate detailed guidance is provided Fair value through profit or loss Investments in associates are always classified as non current assets Section 15 Investments in Joint Ventures For investments in jointly controlled entities there is an option for the venturer to use Cost model except if there is a published quotation then must use fair value through profit or loss Equity method using the guidance in Section 14 Fair value through profit or loss Proportionate consolidation is prohibited For jointly controlled operations the venturer should recognise assets that it controls and liabilities it incurs as well as its share of income earned and expenses that are incurred For jointly controlled assets the venturer should recognise its share of the assets and liabilities it incurs as well as income it earns and expenses that are incurred Section 16 Investment Property Investment property is investments in land buildings or part of a building and some property interests in finance leases held to earn rentals or for capital appreciation or both Property interests that are held under an operating lease may be classified as an investment property provided the property would otherwise have met the definition of an investment property Mixed use property must be separated between investment and operating property If fair value can be measured reliably without undue cost or effort use the fair value through profit or loss model Otherwise an entity must treat investment property as property plant and equipment using Section 17 Section 17 Property Plant and Equipment Historical cost depreciation impairment model or revaluation model Section 17 applies to most investment property as well but if fair value of investment property can be measured reliably without undue cost or effort then the fair value model in Section 16 applies Section 17 applies to property held for sale there is no special section on assets held for sale Holding for sale is an indicator of possible impairment Cost model Measurement is initially at cost including costs to get the property ready for its intended use subsequent to acquisition the entity uses the cost depreciation impairment model which recognises depreciation and impairment of the carrying amount Revaluation model Measurement is at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses revaluations must be made with sufficient regularity The carrying amount of an asset less estimated residual value is depreciated over the asset s anticipated useful life The method of depreciation shall be the method that best reflects the consumption of the asset s benefits over its life Separate significant components should be depreciated separately Component depreciation only if major parts of an item of PP E have significantly different patterns of consumption of economic benefits Review useful life residual value depreciation rate only if there is a significant change in the asset or how it is used Any adjustment is a change in estimate prospective Impairment testing and reversal follow Section 27 revaluation model added by 2015 Amendments to the IFRS for SMEs issued on 21 May 2015 effective 1 January 2017 Section 18 Intangible Assets other than Goodwill No recognition of internally generated intangible assets Therefore Charge all research and development costs to expense Charge the following items to expense when incurred Costs of internally generated brands logos and masthead start up costs training costs advertising and relocating of a division or entity Amortisation model for intangibles that are purchased separately acquired in a business combination acquired by grant and acquired by exchange of other assets Amortise over useful life If the entity is unable to estimate useful life then use the management s best estimate but not more than 10 years Review useful life residual value depreciation rate only if there is a significant change in the asset or how it is used Any adjustment is a change in estimate prospective Impairment testing follow Section 27 Any revaluation of intangible assets is prohibited clarified by 2015 Amendments to the IFRS for SMEs issued on 21 May 2015 effective 1 January 2017 originally the standard required the use of 10 years if the entity is unable to estimate useful life Section 19 Business Combinations and Goodwill Section does not apply to combinations of entities under common control Acquisition purchase method Under this method An acquirer must always be identified The cost of the business combination is measured Cost is the fair value of assets given liabilities incurred or assumed and equity instruments issued plus costs directly attributable to the combination At the acquisition date the cost is allocated to the assets acquired and liabilities and provisions for contingent liabilities assumed The identifiable assets acquired and liabilities and provisions for contingent liabilities assumed are measured at their fair values Any difference between cost and amounts allocated to identifiable assets and liabilities including provisions is recognised as goodwill or so called negative goodwill All goodwill must be amortised If the entity is unable to estimate useful life then use 10 years Negative goodwill first reassess original accounting If that is ok then immediate credit to profit or loss Impairment testing of goodwill follow Section 27 Reversal of goodwill impairment is not permitted Section 20 Leases Scope includes arrangements that contain a lease IFRIC 4 Leases are classified as either finance leases or operating leases Finance leases result in substantially all the risks and rewards incidental to ownership being transferred between the parties while operating leases do not Substantially all risks and rewards of ownership are presumed transferred if the lease transfers ownership of the asset to the lessee by the end of the lease term the lessee has a bargain purchase option the lease term is for the major part of the economic life of the asset even if title is not transferred at the inception of the lease the present value of the minimum lease payments amounts to at least substantially all of the fair value of the leased asset the leased assets are of such a specialised nature that only the lessee can use them without major modifications the lessee bears the lessor losses if cancelled a secondary rental period at below market rates the residual value risk is borne by the lessee Lessees finance leases The rights and obligations are to be recognised as assets and liabilities at fair value or if lower the present value of the minimum lease payments Any direct costs of the lessee are added to the asset amount recognised Subsequently payments are to be spilt between a finance charge and reduction of the liability The asset should be depreciated either over the useful life or the lease term Lessees operating leases Payments are to be recognised as an expense on the straight line basis unless payments are structured to increase in line with expected general inflation or another systematic basis is better representative of the time pattern of the user s benefit Lessors finance leases The rights are to be recognised as assets held i e as a receivable at an amount equal to the net investment in the lease The net investment in a lease is the lessor s gross investment in the lease including unguaranteed residual value discounted at the interest rate implicit in the lease For finance leases other than those involving manufacturer or dealer lessors initial direct costs are included in the initial measurement of the finance lease receivable and reduce the amount of income recognised over the lease term If there is an indication that the estimated unguaranteed residual value used in computing the lessor s gross investment in the lease has changed significantly the income allocation over the lease term is revised and any reduction in respect of amounts accrued is recognised immediately in profit or loss Lessors finance leases by a manufacturer or dealer A finance lease of an asset by a manufacturer or dealer lessor gives rise to two types of income profit or loss equivalent to the profit or loss resulting from an outright sale of the asset being leased at normal selling prices reflecting any applicable volume or trade discounts and finance income over the lease term The sales revenue recognised at the commencement of the lease term by a manufacturer or dealer lessor is the fair value of the asset or if lower the present value of the minimum lease payments accruing to the lessor computed at a market rate of interest The cost of sale recognised at the commencement of the lease term is the cost or carrying amount if different of the leased property less the present value of the unguaranteed residual value The difference between the sales revenue and the cost of sale is the selling profit which is recognised in accordance with the entity s policy for outright sales If artificially low rates of interest are quoted selling profit shall be restricted to that which would apply if a market rate of interest were charged Costs incurred by manufacturer or dealer lessors in connection with negotiating and arranging a lease shall be recognised as an expense when the selling profit is recognised Lessors operating leases Lessors retain the assets on their balance sheet and payments are to be recognised as income on the straight line basis unless payments are structured to increase in line with expected general inflation or another systematic basis is better representative of the time pattern of the user s benefit Sale and leaseback If a sale and leaseback results in a finance lease the seller should not recognise any excess as a profit but recognise the excess over the lease term If a sale and leaseback results in an operating lease and the transaction was at fair value the seller shall recognise any profits immediately Section 21 Provisions and Contingencies Provisions Provisions are recognised only when a there is a present obligation as a result of a past event b it is probable that the entity will be required to transfer economic benefits and c the amount can be estimated reliably The obligation may arise due to contract or law or when there is a constructive obligation due to valid expectations having been created from past events However these do not include any future actions that may create an expectation Nor can expected future losses be recognised as provisions Initially recognised at the best possible estimate at the reporting date This value should take into any time value of money if this is considered material When all or part of a provision may be reimbursed by a third party the reimbursement is to be recognised separately only when it is virtually certain payment will be received Subsequently provisions are to be reviewed at each reporting date and adjusted to meet the best current estimate Any adjustments are recognised in profit and loss while any unwinding of discounts is to be treated as a finance cost Must accrue provisions for examples Onerous contracts Warranties Restructuring if legal or constructive obligation to restructure Sales refunds May NOT accrue provisions for example Future operating losses no matter how probable Possible future restructuring plan but not yet a legal or constructive obligation Contingent liabilities These are not recognised as liabilities Unless remote disclose an estimate of the financial effect indications of the uncertainties relating to timing or amount and the possibility of reimbursement Contingent assets These are not recognised as assets Disclose a description of the nature and the financial effect Section 22 Liabilities and Equity Guidance on classifying an instrument as liability or equity An instrument is a liability if the issuer could be required to pay cash Puttable financial instruments are only recognised as equity if it has all of the following features The holder is entitled to a pro rata share of the entity s net assets in the event of liquidation The instrument is the most subordinate class All financial instruments in the most subordinate class have identical features Apart from the puttable features the instrument includes no other financial instrument features The total expected cash flows attributable to the instrument over the life of the instrument are based substantially on the change in the value of the entity Members shares in co operative entities and similar instruments are only classified as equity if the entity has an unconditional right to refuse redemption of the members shares or the redemption is unconditionally prohibited by local law regulation or the entity s governing charter If the entity could not refuse redemption the members shares are classified as liabilities Covers some material not covered by full IFRSs including original issuance of shares and other equity instruments Shares are only recognised as equity when another party is obliged to provide cash or other resources in exchange for the instruments The instruments are measured at the fair value of cash or resources received net of transaction cost unless the time value of money is significant in which case initial measurement is at the present value amount When shares are issued before the cash or other resources are received the amount receivable is presented as an offset to equity in the statement of financial position and not as an asset Any shares subscribed for which no cash is received are not recognised as equity before the shares are issued sales of options rights and warrants stock dividends and stock splits these do not result in changes to total equity but rather reclassification of amounts within equity Split accounting is required to account for issuance of convertible instruments Proceeds on issue of convertible and other compound financial instruments are split between liability component and equity component The liability is measured at its fair value and the residual amount is the equity component The liability is subsequently measured using the effective interest rate with the original issue discount amortised as added interest expense A comprehensive example of split accounting is included If a liability is fully or partially extinguished by issuing equity instruments to the creditor the equity instruments issued are measuered at their fair value If the fair value of the equity instruments issued cannot be measured reliably without undue cost or effort the equity instruments is measured at the fair value of the financial liability extinguished Treasury shares an entity s own shares that are reacquired are measured at the fair value of the consideration paid and are deducted from the equity No gain or loss is recognised on subsequent resale of treasury shares Minority interest changes that do not affect control do not result in a gain or loss being recognised in profit and loss They are equity transactions between the entity and its owners Dividends paid in the form of distribution of assets other than cash are recognised when the entity has an obligation to distribute the non cash assets The dividend liability is measured at the fair value of the assets to be distributed If the fair value of the assets to be distributed cannot be measured reliably without undue cost or effort the liability shall be measured at the carrying amount of the assets to be distributed added by 2015 Amendments to the IFRS for SMEs issued on 21 May 2015 effective 1 January 2017 Section 23 Revenue Revenue results from the sale of goods services being rendered construction contracts income by the contractor and the use by others of your assets Some types of revenue are excluded from this section and dealt with elsewhere leases section 20 dividends from equity accounted entities section 14 and 15 changes in fair value of financial instruments section 11 and 12 initial recognition and subsequent re measurement of biological assets section 34 and initial recognition of agricultural produce section 34 Principle for measurement of revenue is the fair value of the consideration received or receivable taking into account any possible trade discounts or rebates including volume rebates and prompt settlement discounts If payment is deferred beyond normal payment terms there is a financing component to the transaction In that case revenue is measured at the present value of all future receipts The difference is recognised as interest revenue Recognition sale of goods An entity shall recognise revenue from the sale of goods when all the following conditions are satisfied a the entity has transferred to the buyer the significant risks and rewards of ownership of the goods b the entity retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold c the amount of revenue can be measured reliably d it is probable that the economic benefits associated with the transaction will flow to the entity e the costs incurred or to be incurred in respect of the transaction can be measured reliably Recognition sale of services Use the percentage of completion method if the outcome of the transaction can be estimated reliably Otherwise use the cost recovery method Recognition construction contracts Use the percentage of completion method if the outcome of the contract can be estimated reliably Otherwise use the cost recovery method Recognition interest Interest shall be recognised using the effective interest method as described in Section 11 Recognition royalties Royalties shall be recognised on an accrual basis in accordance with the substance of the relevant agreement Recognition dividends Dividends shall be recognised when the shareholder s right to receive payment is established Appendix of examples of revenue recognition under the principles in Section 23 Award credits or other customer loyalty plan awards need to be accounted for separately The fair value of such awards reduces the amount of revenue initially recognised and instead is recognised when awards are redeemed Section 24 Government Grants This section does not apply to any grants in the form of income tax benefits All grants are measured at the fair value of the asset received or receivable Recognition as income Grants without future performance conditions are recognised in profit or loss when proceeds are receivable If there are performance conditions the grant is recognised in profit or loss only when the conditions are met Section 25 Borrowing Costs Borrowing costs are interest and other costs arising on an entity s financial liabilities and finance lease obligations All borrowing costs are charged to expense when incurred none are capitalised Section 26 Share based Payment Basic principle all share based payment must be recognised Equity settled Transactions with other than employees are recorded at the fair value of the goods and services received if these can be estimated reliably Transactions with employees or where the fair value of goods and services received cannot be reliably measured are measured with reference to the fair value of the equity instruments granted Cash settled Liability is measured at fair value on grant date and at each reporting date and settlement date with each adjustment through profit or loss For employees where shares only vest after a specific period of service has been completed recognise the expense as the service is rendered Share based payment with cash alternatives Account for all such transactions as cash settled unless the entity has a past practice of settling by issuing equity instruments or the option has no commercial substance because the cash settlement amount bears no relationship to and is likely to be lower in value than the fair value of the equity instrument Fair value of equity instruments granted a Observable market price if available b If no observable price use entity specific market data such as a recent share transaction or valuation of the entity c If a and b are impracticable directors must use their judgement to estimate fair value Certain government mandated plans provide for equity investors such as employees to acquire equity without providing goods or services that can be specifically identified or by providing goods or services that are clearly less than the fair value of the equity instruments granted These are equity settled share based payment transactions within the scope of this section Section 27 Impairment of Assets Inventories write down in profit or loss to lower of cost and selling price less costs to complete and sell if below carrying amount When the circumstances that led to the impairment no longer exist the impairment is reversed through profit or loss Other assets write down in profit or loss to recoverable amount if below carrying amount When the circumstances that led to the impairment no

    Original URL path: http://www.iasplus.com/en/standards/other/ifrs-for-smes (2016-02-10)
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  • IFRS Practice Statement 'Management Commentary'
    specifically required by their jurisdiction Furthermore non compliance with the Practice Statement will not prevent an entity s financial statements from complying with IFRSs if they otherwise do so Scope The Practice Statement should be applied by entities that present management commentary that relates to financial statements prepared in accordance with IFRSs It applies only to management commentary and not other information presented in financial statements or broader financial reports Management commentary is defined as A narrative report that relates to financial statements that have been prepared in accordance with IFRSs Management commentary provides users with historical explanations of the amounts presented in the financial statements specifically the entity s financial position financial performance and cash flows It also provides commentary on an entity s prospects and other information not presented in the financial statements Management commentary also serves as a basis for understanding management s objectives and its strategies for achieving those objectives Framework Management commentary should provide users of financial statements existing and potential investors lenders and other creditors with integrated information providing a context for the related financial statements including the entity s resources and the claims against the entity and its resources and the transactions and other events that change them Management commentary should be consistent with the following principles Provide management s view of the entity s performance position and progress including forward looking information Supplement and complement information presented in the financial statements and possess the qualitative characteristics described in the Conceptual Framework for Financial Reporting Presentation Management commentary should be clear and straightforward and be presented with a focus on the most important information in a manner intended to address the principles described in the Practice Statement specifically being consistent with its related financial statements avoiding duplicating disclosures made in the notes to the financial statements where practicable avoiding generic and immaterial disclosures Elements of management commentary Although the particular focus of management commentary will depend on the facts and circumstances of the entity management commentary should include information that is essential to an understanding of the five elements discussed in the table below The table links these elements with the IASB s assessment of the needs of the primary users of management commentary Element User needs The nature of the business The knowledge of the business in which an entity is engaged and the external environment in which it operates Management s objectives and its strategies for meeting those objectives To assess the strategies adopted by the entity and the likelihood that those strategies will be successful in meeting management s stated objectives The entity s most significant resources risks and relationships A basis for determining the resources available to the entity as well as obligations to transfer resources to others the ability of the entity to generate long term sustainable net inflows of resources and the risks to which those resource generating activities are exposed both in the near term and in the long term The results of operations and prospects

    Original URL path: http://www.iasplus.com/en/standards/other/management-commentary (2016-02-10)
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  • Effective dates of IFRSs and amendments
    after 1 January 2013 Amendments to transitional guidance June 2012 Annual periods beginning on or after 1 January 2013 Amendments regarding the accounting for acquisitions of an interest in a joint operation May 2014 Annual periods beginning on or after 1 January 2016 IFRS 12 Disclosure of Interests in Other Entities Original issue May 2011 Annual periods beginning on or after 1 January 2013 Amendments to transitional guidance June 2012 Annual periods beginning on or after 1 January 2013 Amendments for investment entities October 2012 Annual periods beginning on or after 1 January 2014 Amendments regarding the application of the consolidation execption December 2014 Annual periods beginning on or after 1 January 2016 IFRS 13 Fair Value Measurement Original issue May 2011 Annual periods beginning on or after 1 January 2013 Amendments resulting from Annual Improvements 2010 2012 Cycle short term receivables and payables December 2013 Amendments to basis for conclusions only Amendments resulting from Annual Improvements 2011 2013 Cycle scope of the portfolio exception in paragraph 52 December 2013 Annual periods beginning on or after 1 July 2014 IFRS 14 Regulatory Deferral Accounts Original issue January 2014 Applies to an entity s first annual IFRS financial statements for a period beginning on or after 1 January 2016 IFRS 15 Revenue from Contracts with Customers Original issue May 2014 Applies to an entity s first annual IFRS financial statements for a period beginning on or after 1 January 2017 2018 see below Amendments to defer the effective date to 1 January 2018 September 2015 Annual periods beginning on or after 1 January 2018 IFRS 16 Leases Original issue January 2016 Annual periods beginning on or after 1 January 2019 International Financial Reporting Standard for Small and Medium sized Entities IFRS for SMEs Original issue 2009 Effective immediately on issue Amendments as the result of the first comprehensive review 2015 Annual periods beginning on or after 1 January 2017 International Accounting Standards IASs Pronouncement Issued Effective date IAS 1 Presentation of Financial Statements Original issue 2003 Annual periods beginning on or after 1 January 2005 Amendment to add disclosures about an entity s capital 2005 Annual periods beginning on or after 1 January 2007 Comprehensive revision including requiring a statement of comprehensive income 2007 Annual periods beginning on or after 1 January 2009 Amendments relating to disclosure of puttable instruments and obligations arising on liquidation 2008 Annual periods beginning on or after 1 January 2009 Amendments resulting from May 2008 Annual Improvements to IFRSs May 2008 Annual periods beginning on or after 1 January 2009 Amendments resulting from April 2009 Annual Improvements to IFRSs April 2009 Annual periods beginning on or after 1 January 2010 Amendments resulting from May 2010 Annual Improvements to IFRSs May 2010 Annual periods beginning on or after 1 January 2011 Amendments to revise the way other comprehensive income is presented June 2011 Annual periods beginning on or after 1 July 2012 Amendments resulting from Annual Improvements 2009 2011 Cycle comparative information May 2012 Annual periods beginning on or after 1 January 2013 Amendments resulting from the disclosure initiative December 2014 Annual periods beginning on or after 1 January 2016 IAS 2 Inventories Original issue 2003 Annual periods beginning on or after 1 January 2005 IAS 7 Statement of Cash Flows Original issue 1992 Annual periods beginning on or after 1 January 1994 Amendments resulting from April 2009 Annual Improvements to IFRSs April 2009 Annual periods beginning on or after 1 January 2010 Amendments as result of the Disclosure initiative January 2016 Annual periods beginning on or after 1 January 2017 IAS 8 Accounting Policies Changes in Accounting Estimates and Errors Original issue 2003 Annual periods beginning on or after 1 January 2005 IAS 10 Events after the Reporting Period Original issue 2003 Annual periods beginning on or after 1 January 2005 IAS 12 Income Taxes Original issue 1996 Annual periods beginning on or after 1 January 1998 Limited scope amendment recovery of underlying assets December 2010 Annual periods beginning on or after 1 January 2012 Amendments regarding the recognition of deferred tax assets for unrealised losses January 2016 Annual periods beginning on or after 1 January 2017 IAS 15 Information Reflecting the Effects of Changing Prices Original issue 2003 Withdrawn effective 1 January 2005 IAS 16 Property Plant and Equipment Original issue 2003 Annual periods beginning on or after 1 January 2005 Amendments resulting from May 2008 Annual Improvements to IFRSs May 2008 Annual periods beginning on or after 1 January 2009 Amendments resulting from Annual Improvements 2009 2011 Cycle servicing equipment May 2012 Annual periods beginning on or after 1 January 2013 Amendments resulting from Annual Improvements 2010 2012 Cycle proportionate restatement of accumulated depreciation on revaluation December 2013 Annual periods beginning on or after 1 July 2014 Amendments regarding the clarification of acceptable methods of depreciation and amortisation May 2014 Annual periods beginning on or after 1 January 2016 Amendments bringing bearer plants into the scope of IAS 16 June 2014 Annual periods beginning on or after 1 January 2016 IAS 17 Leases Original issue 2003 Annual periods beginning on or after 1 January 2005 Amendments resulting from April 2009 Annual Improvements to IFRSs April 2009 Annual periods beginning on or after 1 January 2010 IAS 19 Employee Benefits Amendment adding an option to recognise actuarial gains and losses in full outside profit or loss in a statement of changes in equity 2004 Annual periods beginning on or after 1 January 2006 Amendments resulting from May 2008 Annual Improvements to IFRSs May 2008 Annual periods beginning on or after 1 January 2009 Amended standard resulting from the post employment benefits and termination benefits projects Amended June 2011 Annual periods beginning on or after 1 January 2013 Amended to clarify the requirements that relate to how contributions from employees or third parties that are linked to service should be attributed to periods of service November 2013 Annual periods beginning on or after 1 July 2014 Amendments resulting from September 2014 Annual Improvements to IFRSs September

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  • New and revised pronouncements as at 31 December 2014
    the entity satisfies a performance obligation Guidance is provided on topics such as the point in which revenue is recognised accounting for variable consideration costs of fulfilling and obtaining a contract and various related matters New disclosures about revenue are also introduced Issued 28 May 2014 Summary of IFRS 15 Article Newsletter Revenue resources Effective date Applicable to an entity s first annual IFRS financial statements for a period beginning on or after 1 January 2017 First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Amendments New or revised pronouncement When effective Application at 31 December 2014 to 1st qtrs 2nd qtrs 3rd qtrs Full yrs Offsetting Financial Assets and Financial Liabilities Amendments to IAS 32 Amends IAS 32 Financial Instruments Presentation to clarify certain aspects because of diversity in application of the requirements on offsetting focused on four main areas the meaning of currently has a legally enforceable right of set off the application of simultaneous realisation and settlement the offsetting of collateral amounts the unit of account for applying the offsetting requirements Issued 16 December 2011 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2014 First quarters ending 31 December 2014 Mandatory Second quarters ending 31 December 2014 Mandatory Third quarters ending 31 December 2014 Mandatory Annual periods ending 31 December 2014 Mandatory Investment Entities Amendments to IFRS 10 IFRS 12 and IAS 27 Amends IFRS 10 Consolidated Financial Statements IFRS 12 Disclosure of Interests in Other Entities and IAS 27 Separate Financial Statements to provide investment entities as defined an exemption from the consolidation of particular subsidiaries and instead require that an investment entity measure the investment in each eligible subsidiary at fair value through profit or loss in accordance with IFRS 9 Financial Instruments or IAS 39 Financial Instruments Recognition and Measurement require additional disclosure about why the entity is considered an investment entity details of the entity s unconsolidated subsidiaries and the nature of relationship and certain transactions between the investment entity and its subsidiaries require an investment entity to account for its investment in a relevant subsidiary in the same way in its consolidated and separate financial statements or to only provide separate financial statements if all subsidiaries are unconsolidated Issued 31 October 2012 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2014 First quarters ending 31 December 2014 Mandatory Second quarters ending 31 December 2014 Mandatory Third quarters ending 31 December 2014 Mandatory Annual periods ending 31 December 2014 Mandatory Recoverable Amount Disclosures for Non Financial Assets Amendments to IAS 36 Amends IAS 36 Impairment of Assets to reduce the circumstances in which the recoverable amount of assets or cash generating units is required to be disclosed clarify the disclosures required and to introduce an explicit requirement to disclose the discount rate used in determining impairment or reversals where recoverable amount based on fair value less costs of disposal is determined using a present value technique Issued 29 May 2013 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2014 First quarters ending 31 December 2014 Mandatory Second quarters ending 31 December 2014 Mandatory Third quarters ending 31 December 2014 Mandatory Annual periods ending 31 December 2014 Mandatory Novation of Derivatives and Continuation of Hedge Accounting Amendments to IAS 39 Amends IAS 39 Financial Instruments Recognition and Measurement to make it clear that there is no need to discontinue hedge accounting if a hedging derivative is novated provided certain criteria are met A novation indicates an event where the original parties to a derivative agree that one or more clearing counterparties replace their original counterparty to become the new counterparty to each of the parties In order to apply the amendments and continue hedge accounting novation to a central counterparty CCP must happen as a consequence of laws or regulations or the introduction of laws or regulations Issued 27 June 2013 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2014 First quarters ending 31 December 2014 Mandatory Second quarters ending 31 December 2014 Mandatory Third quarters ending 31 December 2014 Mandatory Annual periods ending 31 December 2014 Mandatory Defined Benefit Plans Employee Contributions Amendments to IAS 19 Amends IAS 19 Employee Benefits to clarify the requirements that relate to how contributions from employees or third parties that are linked to service should be attributed to periods of service In addition it permits a practical expedient if the amount of the contributions is independent of the number of years of service in that contributions can but are not required to be recognised as a reduction in the service cost in the period in which the related service is rendered Issued 21 November 2013 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 July 2014 First quarters ending 31 December 2014 Mandatory Second quarters ending 31 December 2014 Mandatory Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Annual Improvements 2010 2012 Cycle Makes amendments to the following standards IFRS 2 Amends the definitions of vesting condition and market condition and adds definitions for performance condition and service condition IFRS 3 Require contingent consideration that is classified as an asset or a liability to be measured at fair value at each reporting date IFRS 8 Requires disclosure of the judgements made by management in applying the aggregation criteria to operating segments clarify reconciliations of segment assets only required if segment assets are reported regularly IFRS 13 Clarify that issuing IFRS 13 and amending IFRS 9 and IAS 39 did not remove the ability to measure certain short term receivables and payables on an undiscounted basis amends basis for conclusions only IAS 16 and IAS 38 Clarify that the gross amount of property plant and equipment is adjusted in a manner consistent with a revaluation of the carrying amount IAS 24 Clarify how payments to entities providing management services are to be disclosed Issued 12 December 2013 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 July 2014 First quarters ending 31 December 2014 Mandatory Second quarters ending 31 December 2014 Mandatory Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Annual Improvements 2011 2013 Cycle Makes amendments to the following standards IFRS 1 Clarify which versions of IFRSs can be used on initial adoption amends basis for conclusions only IFRS 3 Clarify that IFRS 3 excludes from its scope the accounting for the formation of a joint arrangement in the financial statements of the joint arrangement itself IFRS 13 Clarify the scope of the portfolio exception in paragraph 52 IAS 40 Clarifying the interrelationship of IFRS 3 and IAS 40 when classifying property as investment property or owner occupied property Issued 12 December 2013 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 July 2014 First quarters ending 31 December 2014 Mandatory Second quarters ending 31 December 2014 Mandatory Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Accounting for Acquisitions of Interests in Joint Operations Amendments to IFRS 11 Amends IFRS 11 Joint Arrangements to require an acquirer of an interest in a joint operation in which the activity constitutes a business as defined in IFRS 3 Business Combinations to apply all of the business combinations accounting principles in IFRS 3 and other IFRSs except for those principles that conflict with the guidance in IFRS 11 disclose the information required by IFRS 3 and other IFRSs for business combinations The amendments apply both to the initial acquisition of an interest in joint operation and the acquisition of an additional interest in a joint operation in the latter case previously held interests are not remeasured Note The amendments apply prospectively to acquisitions of interests in joint operations in which the activities of the joint operations constitute businesses as defined in IFRS 3 for those acquisitions occurring from the beginning of the first period in which the amendments apply Amounts recognised for acquisitions of interests in joint operations occurring in prior periods are not adjusted Issued 6 May 2014 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2016 see note in previous column see note above First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Clarification of Acceptable Methods of Depreciation and Amortisation Amendments to IAS 16 and IAS 38 Amends IAS 16 Property Plant and Equipment and IAS 38 Intangible Assets to clarify that a depreciation method that is based on revenue that is generated by an activity that includes the use of an asset is not appropriate for property plant and equipment introduce a rebuttable presumption that an amortisation method that is based on the revenue generated by an activity that includes the use of an intangible asset is inappropriate which can only be overcome in limited circumstances where the intangible asset is expressed as a measure of revenue or when it can be demonstrated that revenue and the consumption of the economic benefits of the intangible asset are highly correlated add guidance that expected future reductions in the selling price of an item that was produced using an asset could indicate the expectation of technological or commercial obsolescence of the asset which in turn might reflect a reduction of the future economic benefits embodied in the asset Issued 12 May 2014 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2016 First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Agriculture Bearer Plants Amendments to IAS 16 and IAS 41 Amends IAS 16 Property Plant and Equipment and IAS 41 Agriculture to include bearer plants within the scope of IAS 16 rather than IAS 41 allowing such assets to be accounted for a property plant and equipment and measured after initial recognition on a cost or revaluation basis in accordance with IAS 16 introduce a definition of bearer plants as a living plant that is used in the production or supply of agricultural produce is expected to bear produce for more than one period and has a remote likelihood of being sold as agricultural produce except for incidental scrap sales clarify that produce growing on bearer plants remains within the scope of IAS 41 Issued 30 June 2014 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2016 First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Equity Method in Separate Financial Statements Amendments to IAS 27 Amends IAS 27 Separate Financial Statements to permit investments in subsidiaries joint ventures and associates to be optionally accounted for using the equity method in separate financial statements Issued 18 August 2014 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2016 First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Sale or Contribution of Assets between an Investor and its Associate or Joint Venture Amendments to IFRS 10 and IAS 28 Amends IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures 2011 to clarify the treatment of the sale or contribution of assets from an investor to its associate or joint venture as follows require full recognition in the investor s financial statements of gains and losses arising on the sale or contribution of assets that constitute a business as defined in IFRS 3 Business Combinations require the partial recognition of gains and losses where the assets do not constitute a business i e a gain or loss is recognised only to the extent of the unrelated investors interests in that associate or joint venture These requirements apply regardless of the legal form of the transaction e g whether the sale or contribution of assets occurs by an investor transferring shares in an subsidiary that holds the assets resulting in loss of control of the subsidiary or by the direct sale of the assets themselves Issued 11 September 2014 Article Newsletter Effective date Applicable on a prospective basis to a sale or contribution of assets occurring in annual periods beginning on or after 1 January 2016 First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Annual Improvements 2012 2014 Cycle Makes amendments to the following standards IFRS 5 Adds specific guidance in IFRS 5 for cases in which an entity reclassifies an asset from held for sale to held for distribution or vice versa and cases in which held for distribution accounting is discontinued IFRS 7 Additional guidance to clarify whether a servicing contract is continuing involvement in a transferred asset and clarification on offsetting disclosures in condensed interim financial statements IAS 9 Clarify that the high quality corporate bonds used in estimating the discount rate for post employment benefits should be denominated in the same currency as the benefits to be paid IAS 34 Clarify the meaning of elsewhere in the interim report and require a cross reference Issued 25 September 2014 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 July 2016 First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Disclosure Initiative Amendments to IAS 1 Amends IAS 1 Presentation of Financial Statements to address perceived impediments to preparers exercising their judgement in presenting their financial reports by making the following changes clarification that information should not be obscured by aggregating or by providing immaterial information materiality considerations apply to the all parts of the financial statements and even when a standard requires a specific disclosure materiality considerations do apply clarification that the list of line items to be presented in these statements can be disaggregated and aggregated as relevant and additional guidance on subtotals in these statements and clarification that an entity s share of OCI of equity accounted associates and joint ventures should be presented in aggregate as single line items based on whether or not it will subsequently be reclassified to profit or loss additional examples of possible ways of ordering the notes to clarify that understandability and comparability should be considered when determining the order of the notes and to demonstrate that the notes need not be presented in the order so far listed in paragraph 114 of IAS 1 Issued 18 December 2014 Article Newsletter Effective date Effective for annual periods beginning on or after 1 January 2016 First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Investment Entities Applying the Consolidation Exception Amendments to IFRS 10 IFRS 12 and IAS 28 Amends IFRS 10 Consolidated Financial Statements IFRS 12 Disclosure of Interests in Other Entities and IAS 28 Investments in Associates and Joint Ventures 2011 to address issues that have arisen in the context of applying the consolidation exception for investment entities by clarifying the following points The exemption from preparing consolidated financial statements for an intermediate parent entity is available to a parent entity that is a subsidiary of an investment entity even if the investment entity measures all of its subsidiaries at fair value A subsidiary that provides services related to the parent s investment activities should not be consolidated if the subsidiary itself is an investment entity When applying the equity method to an associate or a joint venture a non investment entity investor in an investment entity may retain the fair value measurement applied by the associate or joint venture to its interests in subsidiaries An investment entity measuring all of its subsidiaries at fair value provides the disclosures relating to investment entities required by IFRS 12 Issued 18 December 2014 Article Newsletter Effective date Effective for annual periods beginning on or after 1 January 2016 First quarters ending 31 December 2014 Optional Second quarters ending 31 December 2014 Optional Third quarters ending 31 December 2014 Optional Annual periods ending 31 December 2014 Optional Editorial Corrections various The IASB periodically issues Editorial Corrections and changes to IFRSs and other pronouncements Since the beginning of calendar 2012 such corrections have been made in February 2012 July 2012 March 2013 September 2013 November 2013 March 2014 September 2014 and December 2014 Note For details of these editorial corrections see our IASB editorial corrections page Effective date As minor editorial corrections these changes are effectively immediately applicable under IFRS See comment in previous column New and revised Interpretations New or revised pronouncement When effective Application at 31 December 2014 to 1st qtrs 2nd qtrs 3rd qtrs Full yrs IFRIC 21 Levies Provides guidance on when to recognise a liability for a levy imposed by a government both for levies that are accounted for in accordance with IAS 37 Provisions Contingent Liabilities and Contingent Assets and those where the timing and amount of the levy is certain The Interpretation identifies the obligating event for the recognition of a liability as the activity that triggers the payment of the levy in accordance with the relevant legislation It provides the following guidance on recognition of a liability to pay levies The liability is recognised progressively if the obligating event occurs over a period of time If an obligation is triggered on reaching a minimum threshold the

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  • New and revised pronouncements as at 30 September 2014
    entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 Mandatory IFRS 13 Fair Value Measurement Replaces the guidance on fair value measurement in existing IFRS accounting literature with a single standard The IFRS is the result of joint efforts by the IASB and FASB to develop a converged fair value framework The IFRS defines fair value provides guidance on how to determine fair value and requires disclosures about fair value measurements However IFRS 13 does not change the requirements regarding which items should be measured or disclosed at fair value IFRS 13 applies when another IFRS requires or permits fair value measurements or disclosures about fair value measurements and measurements such as fair value less costs to sell based on fair value or disclosures about those measurements With some exceptions the standard requires entities to classify these measurements into a fair value hierarchy based on the nature of the inputs Level 1 quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date Level 2 inputs other than quoted market prices included within Level 1 that are observable for the asset or liability either directly or indirectly Level 3 unobservable inputs for the asset or liability Entities are required to make various disclosures depending upon the nature of the fair value measurement e g whether it is recognised in the financial statements or merely disclosed and the level in which it is classified Issued 12 May 2011 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2013 First quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Second quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 Mandatory IFRS 14 Regulatory Deferral Accounts IFRS 14 permits an entity which is a first time adopter of International Financial Reporting Standards to continue to account with some limited changes for regulatory deferral account balances in accordance with its previous GAAP both on initial adoption of IFRS and in subsequent financial statements Note Entities which are eligible to apply IFRS 14 are not required to do so and so can chose to apply only the requirements of IFRS 1 First time Adoption of International Financial Reporting Standards when first applying IFRSs However an entity that elects to apply IFRS 14 in its first IFRS financial statements must continue to apply it in subsequent financial statements IFRS 14 cannot be applied by entities that have already adopted IFRSs Issued 30 January 2014 Article Newsletter Effective date Applicable to an entity s first annual IFRS financial statements for a period beginning on or after 1 January 2016 First quarters ending 30 September 2014 Optional Second quarters ending 30 September 2014 Optional Third quarters ending 30 September 2014 Optional Annual periods ending 30 September 2014 Optional IFRS 15 Revenue from Contracts with Customers IFRS 15 provides a single principles based five step model to be applied to all contracts with customers The five steps in the model are as follows Identify the contract with the customer Identify the performance obligations in the contract Determine the transaction price Allocate the transaction price to the performance obligations in the contracts Recognise revenue when or as the entity satisfies a performance obligation Guidance is provided on topics such as the point in which revenue is recognised accounting for variable consideration costs of fulfilling and obtaining a contract and various related matters New disclosures about revenue are also introduced Issued 28 May 2014 Article Newsletter Revenue resources Effective date Applicable to an entity s first annual IFRS financial statements for a period beginning on or after 1 January 2017 First quarters ending 30 September 2014 Optional Second quarters ending 30 September 2014 Optional Third quarters ending 30 September 2014 Optional Annual periods ending 30 September 2014 Optional IAS 19 Employee Benefits 2011 An amended version of IAS 19 Employee Benefits with revised requirements for pensions and other post retirement benefits termination benefits and other changes The key amendments include Requiring the recognition of changes in the net defined benefit liability asset including immediate recognition of defined benefit cost disaggregation of defined benefit cost into components recognition of remeasurements in other comprehensive income plan amendments curtailments and settlements eliminating the corridor approach permitted by the existing IAS 19 Introducing enhanced disclosures about defined benefit plans Modifying accounting for termination benefits including distinguishing benefits provided in exchange for service and benefits provided in exchange for the termination of employment and affect the recognition and measurement of termination benefits Clarifying various miscellaneous issues including the classification of employee benefits current estimates of mortality rates tax and administration costs and risk sharing and conditional indexation features Incorporating other matters submitted to the IFRS Interpretations Committee Issued 16 June 2011 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2013 First quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Second quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 Mandatory IAS 27 Separate Financial Statements 2011 Amended version of IAS 27 which now only deals with the requirements for separate financial statements which have been carried over largely unchanged from IAS 27 Consolidated and Separate Financial Statements Requirements for consolidated financial statements are now contained in IFRS 10 Consolidated Financial Statements The Standard requires that when an entity prepares separate financial statements investments in subsidiaries associates and jointly controlled entities are accounted for either at cost or in accordance with IFRS 9 Financial Instruments IAS 39 Financial Instruments Recognition and Measurement The Standard also deals with the recognition of dividends certain group reorganisations and includes a number of disclosure requirements Issued 12 May 2011 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2013 First quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Second quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 Mandatory IAS 28 Investments in Associates and Joint Ventures 2011 This Standard supersedes IAS 28 Investments in Associates and prescribes the accounting for investments in associates and sets out the requirements for the application of the equity method when accounting for investments in associates and joint ventures The Standard defines significant influence and provides guidance on how the equity method of accounting is to be applied including exemptions from applying the equity method in some cases It also prescribes how investments in associates and joint ventures should be tested for impairment Issued 12 May 2011 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2013 First quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Second quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 Mandatory Amendments New or revised pronouncement When effective Application at 30 September 2014 to 1st qtrs 2nd qtrs 3rd qtrs Full yrs Disclosures Offsetting Financial Assets and Financial Liabilities Amendments to IFRS 7 Amends the disclosure requirements in IFRS 7 Financial Instruments Disclosures to require information about all recognised financial instruments that are set off in accordance with paragraph 42 of IAS 32 Financial Instruments Presentation The amendments also require disclosure of information about recognised financial instruments subject to enforceable master netting arrangements and similar agreements even if they are not set off under IAS 32 The IASB believes that these disclosures will allow financial statement users to evaluate the effect or potential effect of netting arrangements including rights of set off associated with an entity s recognised financial assets and recognised financial liabilities on the entity s financial position Issued 16 December 2011 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2013 and interim periods within those periods First quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Second quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 Mandatory Offsetting Financial Assets and Financial Liabilities Amendments to IAS 32 Amends IAS 32 Financial Instruments Presentation to clarify certain aspects because of diversity in application of the requirements on offsetting focused on four main areas the meaning of currently has a legally enforceable right of set off the application of simultaneous realisation and settlement the offsetting of collateral amounts the unit of account for applying the offsetting requirements Issued 16 December 2011 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2014 First quarters ending 30 September 2014 Mandatory Second quarters ending 30 September 2014 Mandatory Third quarters ending 30 September 2014 Mandatory Annual periods ending 30 September 2014 Optional Government Loans Amendments to IFRS 1 Amends IFRS 1 First time Adoption of International Financial Reporting Standards to address how a first time adopter would account for a government loan with a below market rate of interest when transitioning to IFRSs The amendments mirror the requirements for existing IFRS preparers in relation to the application of amendments made to IAS 20 Accounting for Government Grants and Disclosure of Government Assistance in relation to accounting for government loans First time adopters of IFRSs are permitted to apply the requirements in paragraph 10A of IAS 20 only to new loans entered into after the date of transition to IFRSs The first time adopter is required to apply IAS 32 Financial Instruments Presentation to classify the loan as a financial liability or an equity instrument at the transition date However if it did not under its previous GAAP recognise and measure a government loan at a below market rate of interest on a basis consistent with IFRS requirements it would be permitted to apply the previous GAAP carrying amount of the loan at the date of transition as the carrying amount of the loan in the opening IFRS statement of financial position An entity would then apply IAS 39 or IFRS 9 in measuring the loan after the transition date Issued 13 March 2012 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2013 First quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Second quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 This pronouncement only applies to first time adopters of IFRSs and must be applied by such entities on a mandatory basis Note 2 Annual Improvements 2009 2011 Cycle Makes amendments to the following standards IFRS 1 Permit the repeated application of IFRS 1 borrowing costs on certain qualifying assets IAS 1 Clarification of the requirements for comparative information IAS 16 Classification of servicing equipment IAS 32 Clarify that tax effect of a distribution to holders of equity instruments should be accounted for in accordance with IAS 12 Income Taxes IAS 34 Clarify interim reporting of segment information for total assets in order to enhance consistency with the requirements in IFRS 8 Operating Segments Issued 17 May 2012 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2013 First quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Second quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 Mandatory Consolidated Financial Statements Joint Arrangements and Disclosure of Interests in Other Entities Transition Guidance Amends IFRS 10 Consolidated Financial Statements IFRS 11 Joint Arrangements and IFRS 12 Disclosure of Interests in Other Entities to provide additional transition relief in by limiting the requirement to provide adjusted comparative information to only the preceding comparative period Also amendments to IFRS 11 and IFRS 12 eliminate the requirement to provide comparative information for periods prior to the immediately preceding period Issued 28 June 2012 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2013 First quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Second quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Third quarters ending 30 September 2014 This pronouncement has already been implemented in previous periods by entities with this reporting date where it applied to the entity Note 1 Annual periods ending 30 September 2014 Mandatory Investment Entities Amendments to IFRS 10 IFRS 12 and IAS 27 Amends IFRS 10 Consolidated Financial Statements IFRS 12 Disclosure of Interests in Other Entities and IAS 27 Separate Financial Statements to provide investment entities as defined an exemption from the consolidation of particular subsidiaries and instead require that an investment entity measure the investment in each eligible subsidiary at fair value through profit or loss in accordance with IFRS 9 Financial Instruments or IAS 39 Financial Instruments Recognition and Measurement require additional disclosure about why the entity is considered an investment entity details of the entity s unconsolidated subsidiaries and the nature of relationship and certain transactions between the investment entity and its subsidiaries require an investment entity to account for its investment in a relevant subsidiary in the same way in its consolidated and separate financial statements or to only provide separate financial statements if all subsidiaries are unconsolidated Issued 31 October 2012 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2014 First quarters ending 30 September 2014 Mandatory Second quarters ending 30 September 2014 Mandatory Third quarters ending 30 September 2014 Mandatory Annual periods ending 30 September 2014 Optional Recoverable Amount Disclosures for Non Financial Assets Amendments to IAS 36 Amends IAS 36 Impairment of Assets to reduce the circumstances in which the recoverable amount of assets or cash generating units is required to be disclosed clarify the disclosures required and to introduce an explicit requirement to disclose the discount rate used in determining impairment or reversals where recoverable amount based on fair value less costs of disposal is determined using a present value technique Issued 29 May 2013 Article Newsletter Effective date Applicable to annual periods beginning on or after 1 January 2014 First quarters ending 30 September 2014 Mandatory Second quarters ending 30 September 2014 Mandatory Third quarters ending 30 September 2014 Mandatory Annual periods ending 30 September 2014 Optional Novation of Derivatives and Continuation of Hedge Accounting Amendments to IAS 39 Amends IAS 39 Financial Instruments Recognition and Measurement to make it clear that there is no need to discontinue hedge accounting if a hedging derivative is novated provided certain criteria are met A novation indicates an event where the original parties to a derivative agree that one or more clearing counterparties replace their original counterparty to become the new counterparty to each of the parties In order to apply the amendments and continue hedge accounting novation to a central counterparty CCP must happen as a consequence of laws or regulations or the introduction of laws or regulations Issued 27 June 2013 Article Newsletter Effective date Applicable to annual periods beginning on or after 1

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  • IASB finalised pronouncements
    issued at the publication date including those that do not become mandatory until a future date A Guide through IFRS 2015 Green Book is now available 22 Sep 2015 The IFRS Foundation has announced that A Guide through IFRS 2015 is now available This volume nicknamed the Green Book includes the full text of the Standards and Interpretations and accompanying documents such as the Basis for Conclusions issued by the IASB as of 1 July 2015 with extensive cross references and other annotations This edition does not contain documents that are being replaced or superseded but remain applicable if a reporting entity chooses not to adopt the newer versions early New and revised pronouncements as at 30 September 2015 21 Sep 2015 Our popular summary of new and revised financial reporting requirements updated for financial reporting periods ending on 30 September 2015 This listing can be used to perform a quick check that new financial reporting requirements such as new and revised accounting standards and interpretations and amendments to standards and interpretations have been fully considered in the reporting close process The information below can also be used to assist with the disclosure requirements under paragraph 30 of IAS 8 Accounting Policies Changes in Accounting Estimates and Errors which requires entities to disclose any new IFRSs that are in issue but not yet effective and which are likely to impact the entity IASB defers effective date of IFRS 15 11 Sep 2015 The International Accounting Standards Board IASB has published Effective Date of IFRS 15 deferring the effective date of IFRS 15 Revenue from Contracts with Customers to 1 January 2018 Earlier application of IFRS 15 continues to be permitted EFRAG supports deferral of IFRS 10 IAS 28 amendments recommends postponing the endorsement process 09 Sep 2015 The European Financial Reporting Advisory Group EFRAG has issued a draft comment letter on IASB exposure draft ED 2015 7 Effective Date of Amendments to IFRS 10 and IAS 28 It has also recommended to the European Commission to further postpone the endorsement process on these amendments 2015 IFRS Green Book coming soon 20 Aug 2015 The IFRS Foundation has announced that A Guide through IFRS 2015 will be available soon New and revised pronouncements as at 30 June 2015 30 Jun 2015 Our popular summary of new and revised financial reporting requirements updated for financial reporting periods ending on 30 June 2015 This listing can be used to perform a quick check that new financial reporting requirements such as new and revised accounting standards and interpretations and amendments to standards and interpretations have been fully considered in the reporting close process The information below can also be used to assist with the disclosure requirements under paragraph 30 of IAS 8 Accounting Policies Changes in Accounting Estimates and Errors which requires entities to disclose any new IFRSs that are in issue but not yet effective and which are likely to impact the entity IASB issues finalised amendments to the IFRS for SMEs 21

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  • Background to International Financial Reporting Standards (IFRSs)
    including standards and interpretations approved by the IASB and IASs and SIC interpretations approved by the predecessor International Accounting Standards Committee IFRSs as defined in Standards Paragraph 7 of IAS 1 Presentation of Financial Statements defines IFRSs as comprising International Financial Reporting Standards International Accounting Standards IFRIC Interpretations SIC Interpretations The definition of IFRSs was amended after the name changes introduced by the revised IFRS Foundation Constitution in 2010 Requirements for issuing IFRSs In developing IFRSs the IASB follows its due process requirements Under the IFRS Foundation Constitution the publication of an exposure draft or an IFRS including an International Accounting Standard or an Interpretation of the Interpretations Committee requires approval by nine members of the IASB if there are fewer than sixteen members ten members of the IASB if there are sixteen members Other decisions of the IASB including the publication of a discussion paper require a simple majority of the members of the IASB present at a meeting that is attended by at least 60 per cent of the members of the IASB in person or by telecommunications Compliance with IFRSs Paragraph 16 of IAS 1 requires An entity whose financial statements comply with IFRSs shall make an explicit and unreserved statement of such compliance in the notes An entity shall not describe financial statements as complying with IFRSs unless they comply with all the requirements of IFRSs When a Standard or an Interpretation specifically applies to a transaction other event or condition the accounting policy or policies applied to that item shall be determined by applying the Standard or Interpretation and considering any relevant Implementation Guidance issued by the IASB for the Standard or Interpretation IAS 8 7 Related news IASB publishes updated list of IFRS learning resources 04 Dec 2015 The IASB maintains a list of

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  • Use and adoption of IFRS
    United States English Toggle navigation Search site Toggle navigation Home News Publications Meetings Standards Projects Jurisdictions Resources My IAS Plus Topics Communications Toggle navigation Search site Navigation Resources IFRS Foundation and the IASB Use and adoption of IFRS Global organisations Regional organisations Topics in financial reporting Research and education Sustainability and integrated reporting Info Use and adoption of IFRS From this page you will find information about the use of International Financial Reporting Standards IFRS in various jurisdictions of the world the adoption of IFRS in various jurisdictions and a chronology of IFRS in Europe Title Description Use of IFRS by jurisdiction A summary of our understanding of the use of International Financial Reporting Standards around the world Use of IFRSs by jurisdiction G20 domestic listed companies A summary of our understanding of the use of International Financial Reporting Standards IFRSs as the primary GAAP by domestic listed companies in G20 countries in their consolidated financial statements for external financial reporting Adoption of IFRS by country A summary of recent news and other information related to the adoption of IFRSs in individual jurisdictions IFRS in Europe Background information about the use of IFRSs in Europe and the various organisations and bodies involved in financial reporting in Europe together with a year by year chronology of IFRS related events in Europe Quick links Jurisdictions Guide to jurisdiction specific publications Latest news FEE briefing paper on the endorsement of IFRS 9 08 Feb 2016 EU endorsement of IFRS 9 now expected in the second half of 2016 04 Feb 2016 EBA launches an impact assessment of IFRS 9 on banks 28 Jan 2016 Roadmap drawn up for IFRS convergence of Indian banks and insurers 19 Jan 2016 European consultation on non financial reporting guidelines 15 Jan 2016 Contact us About Legal Privacy

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