IFRS Differences Flashcards
What is the seperate category under PP&E that is exclusive to IFRS?
Biological assets.
How is vacation pay and sick pay reported under IFRS?
If they are accumulated they are required to be accrued
When can you reclassify a short term obligation to a long term obligation under IFRS?
When the entity has entered into an agreement to refinance on a long term basis
What is the difference in impairment methods between GAAP and IFRS?
GAAP requires a 2 step method only when impairment is suspected
IFRS requires a 1 step method at financial statement date
What are the different methods allowed for the operating section of the statement of cash flows for IFRS?
Direct, indirect, and modified direct method (shows revenue, expenses, and changes in working capital accounts in operating activities)
How are interest and dividends received reported on the statement of cash flows for IFRS?
As an investing activity unless lending is normal business activity
How are impairment recoveries recognized under GAAP and IFRS?
GAAP does not allow impairment recoveries
IFRS allows impairment recoveries recognized in income up to the extent of losses previously recognized
How are financial assets and liabilities recognized under IFRS?
Financial assets are recognized at fair value unless certain criteria is met, requiring amortized cost
Financial liabilities are recognized at fair value through profit or loss
How is a negative cash balance reported under IFRS and GAAP?
It is reported as a negative cash equivalent for IFRS, a negative cash balance under GAAP
What is a low value lease under IFRS?
Lease worth $5,000 or less. May be classified as short term if it contains a purchase option
Can a lease with a purchase option be classified as short term under IFRS?
No, unless it falls into the “low value leases” category
How are actuarial gains and losses recognized under GAAP and IFRS?
GAAP uses the corridor approach for recognized actuarial gains or losses in pension expense
IFRS recognizes acturial gains and losses immediately in OCI
What inventory costing method does IFRS not allow?
LIFO is not allowed
How are research and development costs treated under IFRS?
Research expense, development may be capitalized if certain criteria met
How are all leases classified on the balance sheet under IFRS?
They are all finance leases
Out of the different accounting changes, which one is not included under IFRS?
No provision for change in reporting entity
When is consolidation required under IFRS?
When entity has control evidence by power over investee, exposure to variable returns, and power to affect returns
How are contingent gains treated under IFRS?
Required to be disclosed if probable
How is interest paid shown on the statement of cash flows for IFRS?
Interest paid is financing
What model is allowed to account for intangibles under IFRS?
Revaluation model is allowed if fair value is reasonably estimable
When is a consolidation reassessed under IFRS?
Only if there is a change in circumstances
What is a provision under IFRS?
Loss that is probable and estimable, resulting from a past event
Recognized
How is non-controlling interest recognized under IFRS?
Recognized at fair value or proportionate amount of net assets
How are contingencies recognized under IFRS?
They are not recognized
What are the requirements for financial statement presentation under IFRS?
- Comparative financial statements required, including immediately prior period
- Requires a seperate statement of comprehensive income and statement of changes in equity
When are deferred tax assets recognized under IFRS?
When it is reasonably assured of realization
