IAS & IFRS Flashcards
Related party transaction IAS number ?
IAS 24
What is IAS 24 related party disclosure objective?
To ensure that the FS contain the correct disclosure relating to related party transactions to draw the attention to the users that could affect the profit and loss as a result of the these transactions
IAS 24 - related parties - what does this define as?
A transfer from a related party regardless if a price has been charged
IAS 24 - for a person to have significant control, what share holding must they have?
20 - 50 %
IAS 24 - Related party of an entity - what three are the types?
Members of group, joint venture and associates post employment benefit plan
IAS 24 - Related parties - what requirement of disclosures?
Name of entity, nature if transaction, amount of transaction, outstanding balance and any possible write offs
IFRS 15 and definition?
Revenue from contracts with customers - help to assist in when revenue is recognised
IAS 16 Definition?
PPE are tangible items that are held by an entity for the production or the supply of goods or services that are expected to be used for more than one year
IAS 16 - what is the measure at recognition?
Two conditions should be met: 1) probable future economic benefits will flow to the entity 2) the cost of the item can be measure reliable
IAS 23 + definition
Borrowing costs - capitalisation of finance costs including interest are required on any qualifying asset
IFRS 13 + definition?
Fair value measurement - defined as fair value as the price that would be received or paid in the market at the measurement date
IFRS 13 - Fair value - where does the excess dep’n go on revaluated amounts?
transferred to the revaluation surplus - reserve is optional
IAS 38 + definition?
Intangible assets - identifiable non current asset without physical substance
IAS 38 - what two criteras for intangibles to be recognised?
Probable that the entity will receive proable future economic benefits from the asset and the cost can be measured reliably
IAS 38 - what is the measurement after recognition?
Cost model or revaluation module - revaluation module can only be used in an active market
IAS 38 - what is the residual value normally and when does amortisation being?
Zero and when the asset is available for use
IAS 38 - what is the purpose of an indefinite useful life?
No foreseeable limit to a period which the asset is expected to generate net cash flow
IAS 38 - When an asset has a indefinite life what should you do?
Test annually for impairment
IAS 40 and definition ?
Investment property which should be measured at cost and then depreciated or revalued under revaluation
IAS 40 - what happens when a company changes the use from investment to a commercial property?
New cost of the property taken at the fair value at the date of the use and then depreciated under PPE
IAS 40 - what happens when a commercial property becomes a investment property?
Carry value compared to the fair value and any differences are put between the revaluation surplus
IAS 36 and definition?
Impairment of assets, and entity should assess whether there have been any indications that an asset may be impaired
IFRS 12 - and definition?
Disclosure of interest in other entities - requires the company to disclose the interest held in other entities
Definition of business ?
An integrated set of activities and assets that are capable to be managed for purpose of goods and services to generate investment
What three elements makes up a business?
Inputs - economic resources / processes - systems, standards / outputs - goods and services to customers
What is the two stage process for whether this is a acquisition of a business ?
1) is all the funds for identifiable assets = acq of assets / 2) does it have inputs, processes to create outputs = yes - acq of business
What is IAS 21
Effect if change in foreign exchange rate differences
IAS 21 - what is the definition of functional currency ?
Currency of the primary environment which the entity operates in, taking into account currency if sales price, currency of operating costs and currency of operating costs
IAS 21 - foreign currency - functional currency of a foreign subsidiary, what to consider?
Activities that are carried out as an extension of a reporting entity and whether the transactions of the parent represent proportion of the subs activities
IAS 21 - what does functional currency represent?
Measurement of the currency financially, such as in the financial statements
IAS 21 - what is the rate used for p&l and assets and liabilities?
P&l @ average and asset and liabilities at year end closing rate
IAS 21 - How is goodwill calculated at acq?
You will calc at the sub functional currency (local currency)
IAS 21- Foreign currency - what are the principles of functional currency?
Not dependant on the group for finance / influence operating costs / currency of which sales prices are set / operating cash balances
Under IAS 21 - when disposal of a foreign operation, what happens to the exchange rate differences ?
These are reclassified through the profit and loss from the OCI
