ACCA – PROFESSIONAL

STRATEGIC BUSINESS REPORTING

BISC TRAINING CENTER

Mr. Giang Ha, FCCA, CPA
www.bisc.edu.vn
085 8822 168
training@bisc.edu.vn
 Revisions

Summary of
IFRS & IAS

Hockiemtoanonline.edu.vn 2
 IAS 16 PROPERTIES, PLANT AND
EQUIPMENT
IAS 16 PROPERTIES, PLANT AND EQUIPMENT

DEFINITION MEASUREMENT SUBSEQUENCE RECOGNITION DERECOGNITION

Held by an enterprise for
use in the production or
Initial recognition DEPRECIATION Asset should be removerd
COST MODEL REVALUATION MODEL from the SoFP on disposal
supply of goods or services, or when it is withdrawn
for rental to others, or for Includes all costs necessary to get the asset BEGIN
from use & no future
administrative or ready for its intended use Asset is available for FV at the date of revaluation less subsequent dep & economic benefits are
maintenance purposes the use continues until Cost – impairment expected from its disposal
the asset is Accumulated
Cost directly derecognized, even if it
Used during more than Initial estimate Depreciation –
attributable to is idle Only if FV can be measured reliably The gain or loss on
1 reporting period of the cost of and
bringing disposal:
dismantling & impairment
the asset to the should be recognised in
removing the Carried out regularly
RECOGNITION item &
location BASED the SoCI
& condition necessary Depreciation is based
CRITERIA restoring
for it to be capable of on the carrying value in If one asset is revalued, must be whole of the rest
the site on The revaluation surplus
operating in the the statement of of the class at the same time
which it is included in equity should
Costs can be measured manner intended by financial position
located (IAS 37) be transferred directly to
management
reliably FAIR VALUE retained earnings when
DEPRECIATION
METHOD
Market value/ depreciated replacement cost the surplus is realised
COSTS THAT ARE EXCLUDED
Probable to generate Dep method reflects
• Feasibility study costs SURPLUS DEFICIT
future economic benefit the pattern in which
• Start-up costs (unless necessary for working
the asset's future DISCLOSURE
condition of the asset)
economic benefits Revaluation surplus EXPENSE
• Initial operating losses before planned
operating levels FOR EACH CLASS OF PPE
• Abnormal wasted materials, labour or other ASSET DEPRECIATION
Income Set off SURPLUS 1. Basis for measuring
resources It must be determined
carrying amount
• Interest or other costs after PPE is available separately for each
2. Depreciation method(s)
for use even if not yet in use in business significant part of an
SUBSEQUENCE COST used useful lives or
item
• Staff training (IAS38) depreciation rates carrying
REVIEWED amount and accumulated
CAPITALIZED AS PPE depreciation and impairment
The residual value and
Improves the condition of the asset beyond its originally losses
useful life of an asset,
assessed standard of performance 3. reconciliation of the
as well as the
depreciation method carrying amount at the
must be reviewed at beginning and the end of the
EXAMPLE period,
least at each financial
• Extend its useful life, including an increase in its capacity; REVALUED
year end
• Substantial improvement in the quality of output; 1. Effective date of the
CEASE • Substantial reduction in previously assessed operating costs; revaluation
Depreciation of an item • Upgrading of a component of the asset that has been treated 2. Whether an independent
does not cease when it separately for depreciation purposes E.g engine in an aircraft valuer was involved
becomes temporarily 3. Each revalued class of
idle or is retired from property: Carrying amount,
active use and held for Hockiemtoanonline.edu.vn revaluation surplus 3
disposal
 IAS 38 INTANGIBLE ASSETS
WHAT
An identifiable non-monetary
asset without physical
substance
INTANGIBLE ASET
IDENTIFIABLE
Separable from the entity &
sold, transferred, licensed,
exchanged or rented either
individually or combined.
Arises from contractual or
other legal rights
CONTROL
Power to obtain the future
economic benefits flowing
from the asset AND
to restrict the access of
others to those benefits
FUTURE ECONOMIC
BENEFIT
Revenue from the sale of
products, services or
processes OR Cost savings or
other benefits from use of
an asset
• Amortization method
RECOGNITION CRITERIAS
• If the pattern cannot be
PROBABLE FUTURE
ECONOMIC BENEFIT
• Amortization period
COST CAN MEASURED
RELIABLY
IAS 38 INTANGIBLE ASSETS
MEASUREMENT
COST MODEL REVALUATION MODEL
REVALUED AMOUNT being its FV at
Cost less any accumulated the date of the revaluation less any
amortization and any subsequent accumulated amortization
accumulated impairment and any subsequent accumulated
losses
impairment losses
Only allowed IF ACTIVE MARKET exists
MEET all the following conditions:
 The items traded within the market
are homogeneous
 Willing buyers and sellers can
normally be found at any time, and
 Prices are available to the public
TREATMENT
SIMILAR TO IAS 16
AMORTIZATION
IA with FINITE USEFUL LIFE IA with INDEFINIED USEFUL LIFE
No amortization
Amortized over useful life Checked for IMPAIRMENT (IAS 36)
• Tested for impairment on
should reflect the
an annual basis
pattern of benefit
• Also considers whether
the intangible continues
determined reliably,
to have an indefinite life.
amortize by the straight-
line method. • The change in the useful
life assessment for as a
change in an accounting
should be reviewed at
estimate Hockiemtoanonline.edu.vn
least annually.
INTERNAL GENERATED IA COMMON CASE
IA ACQUIRED AS A PART OF
RESEARCH PHASE BUSINESS COMBINATION
Original & planned investigation undertaken with the prospect of Can be separately identified
gaining new scientific or technical knowledge & understanding
E.g: search for application of research findings, search for new
Recognized at FAIR VALUE at
date of acquisition
materials, products, systems…
DEVELOPMENT PHASE
Cannot be separately
identified
Recognized as part of
GOODWILL
Application of research findings or other knowledge to a plan or
design for the production of new or substantially improved
materials, devices, products, processes, systems or services prior IA SEPARATE
to the commencement of commercial production or use
ACQUISITION
E.g: design, testing of pre-use prototypes and models, design of
tools involving new technology …
Any directly attributable
cost of preparing the asset
for its intended use
Capitalize start at time when all 5 criteria below met (if one of 5
criteria not met, do not capitalize)
INTERNAL GENERATED
INTANGIBLE ASSETS
5 CRITERIA TO BE CAPITALIZED
INTERNAL GENERATED
 The TECHNICAL FEASIBILITY of completing the intangible asset
GOODWILL
Not recognized because
so that it will be available for use or sale
cannot measure reliably
 Its INTENTION TO COMPLETE the intangible asset and use or
sell it
 Its ABILITY TO USE OR SELL the intangible asset
 How to intangible asset will generate FUTURE ECONOMIC INTERNAL GENERATED IA
BENEFITS (except GW)
 The AVAILABILITY OF ADEQUATE TECHNICAL, financial & Recognized
other resources to complete the development & to use or sell
the intangible asset
 Its ability to measure the expenditure attributable to the
intangible asset during its development RELIABLY
Development cost capitalized must NOT EXCEED future
economic benefit
4
 IAS 40 INVESTMENT PROPERTIES

IAS 40 INVESTMENT PROPERTIES

INITIAL ACCOUNTING FOR TRANSFERS BETWEEN

WHAT ACCOUNTING TREATMENT DISCLOSURES
MEASUREMENT CATEGORIES
INVESTMENT PROPERTY COST, INCLUDING IAS 40 -> IAS 02/IAS 16
FAIR VALUE The amounts recognized
TRANSACTION COSTS. COST MODEL
Property (land or a building - or
The FV at the change of use is the 'cost' of the MODEL in the income statement
Similar to those contained in
put of a building - or both property (PPE) under its new classification for
IAS 16
(owner or finance lease) Rental income from
PPE to IP (FV)
Except when Changes in FAIR
Held to earn rentals or for investment property
capital appreciation or both,
Such cost should not include cannot measure VALUE to net
start-up costs, abnormal IAS 16 (from cost to FV) should be applied up to the date of FV reliably
rather than for: profit or loss Direct operating
reclassification. Any difference arising between the CA
(a) use in the production or waste, or expense that generated
under IAS 16 at that date & the FV is dealt with as A
supply of goods or services or initial operating losses REVALUATION UNDER IAS 16 rental income
for administration (IAS 16); or incurred before the IP SIMILAR TO IAS REVALUATION Direct operating
(b) Sale in the ordinary course of achieves the planned level of INVENTORY to IP (FV) 16 MODEL expense that did not
business (IAS 2) occupancy Use IAS 36 to IP is carried at FV generated
Any difference between the FV at the date of transfer & it
previous carrying amount should be RECOGNIZED IN check impairment NO depreciation rental income
RECOGNITION PROFIT OR LOSS Meet criteria to Any gain on FV is Cumulative change in FV
be classified as taken to I/S
held for sale in
recognized in the
COMPLETES CONSTRUCTION/DEVELOPMENT OF AN NO RR account
accordance with income statement on
Probable - INVESTMENT PROPERTY THAT WILL BE CARRIED AT FAIR Not subject to sale of investment
Cost IFRS 05 (present
future VALUE IFRS 05
measured as investment property from a pool of
Any difference between the FV at the date of transfer & the
economic property held for assets in which the cost
reliably previous CA should be RECOGNIZED IN PROFIT OR LOSS
benefits sale) model is used to a pool
in which the FV model
DISPOSALS is used
MIXED-USED PROPERTY The chosen measurement model is applied
• An IP shall be derecognized on disposal or when the to ALL OF THE ENTITY'S INVESTMENT
(partly used by the owner &
IP is permanently withdrawn from use at the time PROPERTIES
partly held for rental or
appreciation)must be split with that no benefit is expected from future use or
components accounted for disposal. Should not change unless the change
Separately • Any gain or loss is determined as the difference will result in a more appropriate
between the net disposal proceeds & the CA & is presentation
If cannot sold or leased
separately, the property is recognized in the income statement.
investment property only if the • Compensation from 3rd parties is recognized when
owner-occupied portion is it becomes receivable.
insignificant
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 IAS 23 BORROWING COSTS
SCOPE
Not deal with actual cost of equity
Including preferred capital not classified as EQUITY
WHAT
Borrowing costs for
selfconstructed assets
BORROWING COSTS
Interest and other costs
incurred by an entity
In connection with borrowing
funds
Interest expense calculated by
the effective interest method
Finance charges on finance
leases
Exchanges differences on
foreign currency borrowings
(regarded as an adjustment to
interest cost)
IAS 23 BORROWING COSTS
QUALIFING ASSETS HOW TO TREATMENT? Actual cost incurred – REQUIREMENT
income from temporary Probable that these costs will
AMOUNT investment from borrowing in results in future economic
Exchanges differences on the period of construction benefits to the entity
foreign currency borrowings CAPITALIZATION Costs measured reliably
(regarded as an adjustment to
interest cost)
Active development is
Normally takes > 1 years interrupted (not capitalized)
If common – do not suspend
Could be PPE, investment COST ARRE DIRECTLY SUSPEND Unless a necessary part of the If not common – suspend
property, intangible assets in process for the production of
ATTRIBUTABLE TO
development period, “made to the assets
PRODUCTION/CONSTRUCTION
order” inventory
/ACQUISITION
Inventory required substantial
period to bring in saleable
condition If all that left are minor
Substantially all the activities modification (decoration/
CEASES necessary – completed routine administrative work)
Considered substantially
completed
FUNDS ARE PART OF A MAXIMUM AMOUNT
GENERAL POOL CAPITILIZED
Borrowing costs
capitalized in a period
Weighted average Cannot exceed the
amount of borrowing
capitalization rate
costs incurred by the
of general pool entity during the
period
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 IAS 36 IMPAIRMENT OF PROPERTY
IAS 36 IMPAIRMENT OF PROPERTY

SCOPE ACCOUNTING TREATMENT

IAS 38: Intangible REVERSAL OF If RECOVERABLE AMOUNT of
IAS 16: PPE If RECOVERABLE AMOUNT of
assets IMPAIRMENT individual asset could be individual asset could NOT be
estimated?
IAS 40; Investment IAS 28: Associate Assess at each
property at COST at COST Write-off as Set-off from
balance sheet date SURPLUS
EXPENSE CASH GENERATING UNIT
whether there is an
IMPAIRMENT indication that an (CGU)
impairment loss may
have decreased. If so, If the assets Group of smallest identifiable net
Carrying Recoverable calculate recoverable was assets which
amount amount Recoverable amount amount previously
REVALUED
HIGHER and has a • that generates cash inflows
Impairment loss
The new carrying SURPLUS from continuing use, and
=Fair value amount of the asset • that are largely independent
Value in
WHEN ASSESS IMPAIRMENT – cost of must NOT EXCEED the of the cash inflows from other
use
disposal CARRYING AMOUNT assets or groups of assets
of the asset if NO
IMPAIRMENT has
AT THE END OF ACCOUNTING PERIOD VALUE IN USE How to allocate impairment of
previously taken place
CGU
Intangibles with Indicator of PRESENT VALUE of the future
identify useful life impairment cash flows expected to be 1 Goodwil
delivered from an asset/CGU Prohibited for
goodwill
2 Other assets of the unit pro rata
Goodwill acquired Use of asset DISCOUNT FUTURE
in combination Damage RATE CASH FLOW Recognized in profit
EXPECTS
Change in interest the pre-tax FROM THE or loss unless it Should not show
rate rate that ASSET relates to
Intangible not yet revalued assets HIGHEST
reflects Consider
available for use Life of asset
current possible
Market value of asset
market variations in Adjust depreciation
Obsolescence of asset assessments Fair value –
future cash for future periods Value in
Performance of asset of the time flows, based Cost of
Use (if
value of on disposal
measurable)
Zero
money and reasonable (if
the risks and measurable
specific to
the asset.
supportable
assumptions
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 IFRS 5 NON-CURRENT ASSETS HELD FOR
SALE AND DISCONTINUED OPERATIONS
IFRS 5 NON-CURRENT ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

NON-CURRENT ASSETS HELD FOR SALE DISCONTINUED OPERATIONS

DEFINITION RECOGNIZATION PRESENTATION DEFINITION PRESENTATION

MEASUREMENT
CRITERIAS
ASSETS HELD FOR SALE Appropriate level of
management committed to a SEPARATE ITEMS AS Component of an entity Separate line in financial
plan to sell CURRENT ASSETS Just before classify as held statement
Its carrying amount will Has been disposed OR
for sale
be recovered principally Classified as held for
Active program to locate a MEASURE IN ACCORDANCE
through sale rather than sale
continuing use
buyer WITH APPLICABLE IFRS SOCI
Not depreciation
Assets have active market When classified as held for ‘1. Represents either or
APPLY FOR ALL sale a separate major line of Single amount in SOCI
NONCURRENT ASSET LOWER business or a Post tax profit or loss of
Expected to completed in 1 IAS 36 not apply to discontinued operation
UNDER IAS 01 - CARRYING AMOUNT geographical area of
year asset held for sale - FAIR VALUE – COST TO operation
SELL (present value) ‘2. Part of a single
Unlikely significant changes
DISPOSAL GROUP to withdraw the plan coordinated plan to SOFP
Impairment -> cost (measured dispose of a separate
A group of at FAIR VALUE – COST TO SELL) major line of business
A liability Extension beyond 1
assets to be Change of plans or geographical area of
directly year Increase in FAIR VALUE – COST
disposal operations PRESENTED SEPARATELY
associated TO SELL -> profit (not excess of
together as ‘3. Subsidiary acquired
with those CONDITIONS CUMULATIVE IMPAIRMENT Assets and liabilities
a group in a VALUED AT THE LOWER exclusively with a view
assets that 1. Others may impose LOSS) should not offset
single of the CARRYING to resale and the
will be conditions THAT could not be Major classes of assets
transaction AMOUNT BEFORE disposal involves loss of
transferred completed until after a firm and liabilities should
(e.g: cash the asset or disposal control
in the purchase commitment has separately disclosure in
generated group was classified as
transactions been made and a firm SOFP
unit) held for sale (as adjusted purchase commitment is
for any subsequent highly probable within a year.
depreciation, 2. Buyer unexpectedly
amortization, or imposes conditions on the
evaluation) and its transfer of the NCA held for
RECOVERABLE AMOUNT sale.
at the date of the 3. Unforeseen circumstances
decision not to sell. arise that were considered
Any adjustment shown in unlikely, and the NCA is not
income sold. Hockiemtoanonline.edu.vn 8
 IAS 02 - INVENTORY
COST FORMULA
STANDARD COST & RETAIL
METHODS
May be used for the
measurement of cost, provided
that the results approximate
actual cost
SPECIFIC COST
inventory items that are not
interchangeable, specific costs
are attributed to the specific
individual items of inventory
FIFO & WEIGHTED AVERAGE
COST
items that are interchangeable,
IAS 2 allows the FIFO or weighted
average cost formulas
THESAME COST FORMULA
should be used for all inventories
with SIMILAR CHARACTERISTICS
AS TO THEIR NATURE AND USE
TO THE ENTITY
For groups of inventories that
have different characteristics,
different cost formulas may be
justified.
IAS 02 - INVENTORY
TYPES
INVENTORIES ARE REQUIRED TO BE STATED AT THE LOWER OF COST AND
NET REALISABLE VALUE
RAW MATERIALS
INVENTORY COST NET REALISABLE VALUE Materials and supplies that are
consumed in production
COSTS OF PURCHASE INVENTORY COST SHOULD
WORK IN PROCESS
(including taxes, NOT INCLUDE
transport, and handling) Assets in the production
net of trade discounts process for sale in the ordinary
Estimated selling price in the course of business
received Abnormal waste ordinary course of business
Storage costs
COSTS OF CONVERSION  administrative overheads FINISHED GOODS
(including fixed and unrelated to production
selling costs the estimated cost of Assets held for sale in the
variable manufacturing
completion ordinary course of business
overheads)  foreign exchange differences
arising directly on the recent
acquisition of inventories
Other costs incurred in invoiced in a foreign currency
bringing the inventories  Interest cost when the estimated costs necessary
to their present location inventories are purchased with to make the sale
and condition deferred settlement terms.
COST INCURRED UNTIL
THE INVENTORY IS
COMPLETE GOODS
Hockiemtoanonline.edu.vn 9

WHAT
Biological assets
Living plants & animals
Agricultural produce
The produce harvested from
biological assets
Basic earnings adjusted for after
tax effect of:
Do not adjust the financial
statement
But provide disclosures if
material eventControl the assets
as a result of part events
Probable future economic
inflows will result
IAS 41 - AGRICULTURE
Same number of shares,
different numerator
Starting point is the weighted
average number of shares in
OTHER ISSUES
Fair value – costs to sell Agricultural land is accounted for
Fair value – estimated costs to
INITIAL & SUBSEQUENT under IAS 16
sell AT POINT OF HARVEST
Biological assets that are
GOING CONCERN ISSUES ARISING physically attached to land are
AFTER BALANCE SHEET DATE Gain and any changes measured as biological assets
STATEMENT OF PROFIT OR LOSS separate from the land
Cost related to biological assets
Measured at fair value Assets relating to agricultural
activity (for example, milk quotas)
Recognized as EXPENSE except
for purchase cost of those assets are accounted for under IAS 38
Fair value - According to IFRS 13
Cost to sell
Incremental costs directly attribute to the disposal of an asset
excluding finance costs & taxation
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IFRS 09: FINANCIAL INSTRUMENTS

IFRS 09: FINANCIAL INSTRUMENTS

1. ISSUING FINANCIAL INSTRUMENT
FINANCIAL LIABILITIES COMPOUND FINANCIAL
EQUITY INSTRUMENTS
Contain an obligation to be repaid Evidence of an INSTRUMENT
ownership interest in Financial assets of one
AMORTIZED COST FVTPL the residual net assets financial liability &
equity of others
Initial measurement Initial measurement
Initial measurement DEFINITION
Fair value LESS issue Fair value
cost (Transaction cost P&L) Fair value LESS issue costs

Subsequent The option to convert

Subsequent
measurement at
amortized cost
INTEREST RATE
Using effective interest
rate – charge as finance
cost (never change thís
interest rate)
Change in market
rates of interest rate
are ignored
LIABILITY
- Market value
- The present value of future
The liability will
increase with finance
cost minus cash repaid
measurement with
gains and losses being
recognized in income
WHEN CLASSIFIED
Only classified if HELD
FOR TRADING or
DESIGNATED AT FVTPL
on initial recognition
HOW TO MEASURE
FAIR VALUE
cash flow
(current interest rates)
Subsequent into equity is strictly a
measurement
derivative that is
No change as equity
embedded into the
instruments are not host contract
RE-MEASURED
RECOGNITION
Split out the debt and
equity elements
DEBT ELEMENT
measured at fair value
(present value of
future cash flow)
EQUITY ELEMENT
Balance figure
(proceeds of the issue
– debt element) –
other component of equity

TRANSACTION COST:
Determine effective split proportionately
interest rate at the between the debt and
date of obtain/ issuse equity element
instrument and never
change it
Hockiemtoanonline.edu.vn 11
IFRS 09: FINANCIAL INSTRUMENTS

IFRS 09: FINANCIAL INSTRUMENTS

2. FINANCIAL ASSETS
DEBT INSTRUMENTS EQUITY INSTRUMENTS
Contain an obligation to be repaid Evidence of an ownership interest in the
residual net assets
AMORTIZED COST FVTOCI FVTPL
FVP&L FVTOCI
Initial measurement Initial measurement Initial measurement
FV - transaction cost COST COST
Initial Initial
measurement measurement
Subsequent Subsequent Fair value - Fair value -
Subsequent
measurement measurement transaction cost transaction cost
measurement
Gains and losses being Gains and losses -
Amortized cost
recognized IN OCI income/ expense
Subsequent
Subsequent
measurement
measurement
WHEN CLASSIFIED Fair value with
Fair value with
gains or losses
gains or losses
being recognized
OBJECTIVE – BOTH All other debt being recognized
OBJECTIVE directly in OCE and
Collecting contractual instruments OR directly in P&L
Hold the asset to OCI
cash flow
collect contractual
AND
cash flow WHEN CLASSIFIED
Selling financial assets To avoid an
“accounting
Contractual terms – specified dates SOLEY mismatch”
Held for trading Not held for trading
PAYMENTS OF PRINCIPLES & INTEREST on principle
amount outstanding
RECLASSIFICATION
Change BUSINESS MODEL
BUSINESS MODEL TEST for managing assets
The purpose is to hold the asset to collect the contractual cash flow (rather than Recognized in PROFIT OR LOSS
sell it prior to maturity to realized its fair value changes)
IMPAIRMENT
CASH FLOW TEST Event occurred have detrimental impact on
The contractual terms of assets give rise on specific dates to cash flow are solely the estimate future cash flow of
receipts of either principle or interest the financial asset

Hockiemtoanonline.edu.vn 12
 IFRS 16 – LEASING
KEY DEFINITION
Finance lease where it transfers
substantially all the risks and
rewards incidental to ownership
Operating lease where it does not
transfers substantially all the risk
and rewards incidental to
ownership
INCEPTION DATE OF LEASE
The EARLIER of lease
agreement and the date of
commitment by the parties.
The type of lease is identified
at the date of inception
RESIDUAL VALVE: this may be
GUARANTEED OR
UN -GUARANTEED
GUARANTEED: A guarantee made
to a lessor by a party unrelated to
lessor that the valve of an asset at
the end of lease will be at least a
specified amount
UN-GUARANTEED: is that portion
of residual valve of asset, the
realization of which is not assured
by a party related to the lessor
IFRS 16 – LEASING
ACCOUNTING FOR LEASE BY LESSEE ACCOUNTING FOR LEASE SALE AND LEASE BACK
BY LESSOR
SINGLE LESSEE ACCOUNTING MODEL to recognize for all leases
with a term of more than 12 months unless underlying asset is of TRANSFER IS A SALE – MEET IFRS 15 – (TRANSFER
low valve (office furniture, laptops, tables, telephones - Expense FINANCE LEASE CONTROL OF ASSET)
these out on straight line basis)
THE SELLER
NOT RECORD THE LEASED SPECIAL CASE
RIGHT-OF-USE (ASSET) LIABILITY
Records the amount as
Measure the RIGHT-OF-USE measure the lease liability at the ACCOUNTED FOR AS A SALE
RECEIVABLE as:
(asset) at cost; comprise: Present valve of the lease
payments, that are not paid at Net investment = Present valve of Fair value of
Present valve of lease payments Lease
that date. Gross investment + Present valve the seller measures the the sale
payments
Any lease payment made at or of lease payments OR; rightof-use asset at the consideration
before the commencement date Net investment = Fair valve + Initial proportion of the previous #
After the initial recognition the # Market
(less) any lease incentives direct cost. carrying amount that
lease liability is measured at rates
received. relates to the right of use Asset’s fair
Any initial direct cost incurred by amortized cost using the effective value
retained
lessee. interest method
SUBSEQUENT MEASUREMENT
Any disposal/dismantling costs, the sales proceeds are
Record payments received during the seller only recognises
incurred by lessee adjusted to fair value, either
LEASE PAYMENT the year by making; the amount of gain or loss
Consists of TWO elements: Record finance income, adding a that relates to the rights by accounting for
Account for any depreciation 1. Finance charge on the liability period return to the net prepayments or additional
transferred to the buyer
expense and accumulated to the lessor, by adding a investment and other side as financing
impairment losses (if any) periodic charge to lease income in P&L
liability, with other side of TRANSFER IS NOT A SALE (NOT MEET IFRS 15)
entry as an expense to P/L.
USEFUL LIFE FOR DEPRECIATION 2. Partial repayment of liability.
If asset is owned at the end of OPERATING LEASE FOR SELLER-LESSEE FOR BUYER-LESSOR
lease term: depreciate on useful
life BORROWING TRANSACTION
If asset is not owned at the end of PRESENTATION
Total liability must be divided The lessor records the LEASED
lease term: depreciate EARLIER
between: current and non-current ASSET IN ITS FINANCIAL CONTINUE TO RECOGNIZE
OF: USEFUL LIFE AND LEASE TERM STATEMENT NOT RECOGNIZE the asset
liabilities the asset
Lessor add initial direct costs
incurred by lessor.
REASSESSMENT, RE-MEASUREMENT OF LEASE LIABILITY Recognize FINANCIAL Recognize FINANCIAL ASSET,
LIABILITY, equal to the equal to the transferred
transferred proceed, in proceed in accordance with
After the commencement date, a lessee should remeasure the lease SUBSEQUENT MEASUREMENT
accordance with IFRS 9 IFRS 9
liability (IF ANY CHANGE OCCURS) using either unchanged discount rate or Records the depreciation expense,
revised discount rate to reflect changes in lease payments. the policy must be consistent with
lessor's policy. Lease amortization schedule Lease amortization schedule
A lessee should account for re-measurement of lease liability as an Account for any impairment loss. will be needed for principal will be needed for principal
adjustment to the right-of-use asset to the extent covered by right-of-use Records RENTAL INCOME on a and interest charge over the and interest income over the
asset and remaining amount is recognized in P/L. Hockiemtoanonline.edu.vn
straight-line basis over lease term lease term lease term 13
 IAS 37: PROVISION AND CONTINGENCIES

IAS 37: PROVISION AND CONTINGENCIES

OBLIGATING EVENT PROVISION CONTIGENT ASSETS

WARRANTIES: Provisions must be
estimated on the basis of the
class as a whole & not on
individual claim
FUTURE REPAIR /
REFURBISHMENT: not recognized
/ provided for,
ONEROUS CONTRACT: An
onerous contract is a contract in
which the unavailable costs of
meeting the obligations under
the contract exceed the economic
benefits expected to be received
under it.
ENVIRONMENTAL AND SIMILAR
PROVISIONS: It should be
provided for at its present value
&
depreciated over the useful life of
the oil plant.
RESTRUCTURINGS Liability of uncertain timing or amount
RECOGNITION CRITERIAS RECOGNIZED
detailed formal plan & must
be communicated to all
Present obligation
affected parties especially the
employees
PROBABLE Transfer economic
A restructuring provision benefit to settle
should include only the direct
expenditure arising from the
restructuring,
Reliable estimate of the
amount involved
EXAMPLE OF POSSIBLE PROVISON
WARRANTIES – Estimate provision
MAJOR REPAIRS – no longer be
possible (not recognized provision)
SELF INSURANCE – no obligation exist
(not recognized provision)
WHAT
A possible asset that arises from past events,
INITIAL MEASUREMENT and whose existence will be confirmed only by
The amount recognised as a provision is the occurrence or non-occurrence of one or
more uncertain future events not wholly within
the best estimate of the settlement
the control of the enterprise
amount at the end of the reporting
period.
RECOGNIZED
ONE-OFF EVENTS are measured at the
most likely amount. DO
RECOGNIZE DISCLOSURE
NOTHING
LARGE POPULATIONS OF EVENTS are
measured at a probability-weighted
expected value Virtually Probable Possible
Expected cash outflows should be
discounted to their present values, CONTINGENT LIABILITIES
where the effect of the time value of
money is material. WHAT?
Discount rate: should be pre-tax rate A possible obligation depending on whether
that reflects current market assessments some uncertain future event occurs, or a
of the time value of money & the risks present obligation but payment is not probable
specific to theliability. or the amount cannot be measured reliably

RECOGNIZED
ENVIRONMENTAL CONTAMINATION –
recognized provision
DO
RECOGNIZE DISCLOSURE
NOTHING
DECOMMISSIONING /
ABANDONMENT COST Provision + IAS 16
Probable -
Possible Remote
Hockiemtoanonline.edu.vn PROVISION 14
 IFRS 11 – JOINT ARRANGEMENT

IFRS 11 – JOINT ARRANGEMENT

MAIN TYPES KEY DEFINITION

Joint arrangement
Joint control of the Right to net assets A contractual give two or
JOINT OPERATIONS JOINT VENTURES
arrangement have of the agreement more parties joint control
rights to the assets,
obligation of not structured through a Structure through a A separately
liabilities relating to separate vehicle separate vehicle identifiable Joint control
the arrangement financial structure, The contractually agreed
including separate sharing of control of an
RECOGNITION RECOGNITION legal entities or Any party
arrangement, which
entities recognized exists only when with joint
Join operator Recognized line-by-line by statute, control can
Equity method decisions about the
share regardless of prevent any
SOFP-share post- relevant activities require
Assets whether those other party
Liabilities acquisition total the UNANIMOUS
entities have a legal CONSENT of the parties from
Revenue comprehensive income;
Expense
personality sharing control making
SOCI - share of the joint
Uni-later
venture profit or loss
Both individual and decision
consolidated financial
Consolidated – Equity Unanimous consent
statement
accounting Individual Of the parties that
financial statement – collectively
cost or IFRS 09 control the arrangement

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 IAS 28 – INVESTMENTS IN ASSOCIATE
& JOINT VENTURES

IAS 28 – INVESTMENTS IN ASSOCIATE & JOINT VENTURES

SIGNIFICANT INDIVIDUAL FINANCIAL CONSOLIDATED FINANCIAL STATEMENT

INFLUENCE STATEMENTS OF INVESTOR
EQUITY INVESTMENT IN TRANSACTIONS WITH ASSOCIATES OR JOINT
Holds 20% or more of the EITHER
voting power (directly or
ACCOUNTING ASSOCIATE VENTURES
throughsubsidiaries)
Equity SOFP
According Recognized at cost Profits and losses resulting from upstream
Cost OR to IFRS 09 method Cost + share transactions are eliminated to the extent o
OR in associate total
Adjusted for change in interest in the associate or joint venture
IAS 28 the investor's share of comprehensive Unrealized losses are not recognized
the investee's net income
assets
SOCI Upstream Downstream
Share of the
P&L and OCI Share associate P&L
Share associate OCI Parent sell to associate Associate sell to parent
Dr Retained earning Dr Retained earnings of parent
Cr Investment in associate Cr Group Inventory

Hockiemtoanonline.edu.vn 16
 IFRS 15 REVENUE
IFRS 15 REVENUE
1. Identify the contract with the customer
SPECIAL CASE IN IFRS 15 –
Special case in IFRS 15
1. The contract has been APPROVED by parties to the contract CONSTRUCTION CONTRACT
2. Each PARTY’S RIGHT in relation to the goods to be transferred can be IDENTIFIED
3. The PAYMENT TERMS – IDENTIFY
4. The contract has COMMERICAL SUBTANCE Repurchase agreement DETERMINING THE STAGE OF
5. PROBABLE – consideration will be recoverable COMPLETION (SOC) OF A CONTRACT
2. Identify the SEPARATE PERFORMANCE OBLIGATIONS (POS) Bill-and-hold agreement  the proportion that contract costs
incurred for work performed to date bear
PERFORMANCE OBLIGATION - What you promise on the contract to the estimated total contract costs
Customer acceptance
Identify as a performance obligation (PO) each promise to a goods/service that is  surveys of work performed
DISTINCT  completion of a physical proportion of
(separate from other resources/ goods or service) Licensing and right to use the contract work (given as a percentage)
You can use the product without other things – it is distinct

Recognized revenue with a

3. Determine the transaction price for whole contract (judgment)
right of return exist STATEMENT OF PROFIT OR LOSS
TRANSACTIONS PRICE: Price agreed with the contract in respect of the transfer of the Revenue (total price x SOC) less revenue
goods in satisfaction of the performance obligation (AMOUNT EXPECTS to be Licensing and right to use recognized in previous years Cost of sales
entitled) (total costs x SOC) less cost of sales
FACTOR CONSIDERATIONS IN DETERMINING PRICES
- Variable consideration (expected value – many possible OR the most likely amount)
Breakage & prepayment for recognised in previous years
- Significant financing component future goods/ services

4. Allocate the transaction price to performance obligations IF CONTRACT IS LOSSMAKING

Revenue - recognize as per profitable
HOW TO ALLOCATE
On the basis of STANDARD ALONE SELLING PRICE (SASP) TO ALLOCATE
contract Cost of sales – balancing figure
BUT NO OBSERVE PRICE Loss – insert the FULL loss immediately
1st Adjusted market assessment approach - competitor price
2sd Expected cost plus a margin
3th Residual approach – observable SASP of other goods (limited circumstances) Statement of financial position
5. Recognize revenue when performance obligation satisfied Costs incurred to date
Add: recognised profit/loss to date
TRANSFER of goods/service
Performance obligation satisfied over time Less: progress billings to date
to customer = Contract asset/ liabilities
Asset considered INPUT METHOD: OUTPUT METHOD:
transferred when Recognize revenue on the Recognize revenue on the
customer obtains basis of the value to the basis of the entity’s input such
CONTROL of that assets
customer of the goods/ Hockiemtoanonline.edu.vn
as labor hours, resource 17
services transferred consumed and cost incurred
 IAS 20 – GOVERNMENT GRANT

IAS 20 – GOVERNMENT GRANT

WHAT
Assistance by the government in the form of
GRANT RELATED TO
GRANT RELATED TO ASSET
transfers of resources to an enterprise in INCOME
return for past or future compliance with
certain conditions relating to the operating Deducting the grant
Deferred income
activities of the enterprises from the assets’
Deferred Deducting from
carrying
income related expenses
Dr Cash
RECOGNITION Dr Cash
Cr Deferred income
Cr Asset Change in
GRANT BECOME
REPAYABLE accounting
PRESENATION Reduced depreciation
RECOGNITION Where related cost estimate
change
CRITERIAS have been already been
incurred, the grant may Income statement Dr Deferred income The repayment should be
Should be be reorganized as PRESENATION Dr Income statement
Income: Amortization treated as increasing the
recognized until income in full Cr Cash
of government grant carrying amount of the
there is reasonable immediately Income statement
Expense: Depreciation asset
assurance Expense: No additional Dr Asset
A grant in the form of Depreciation depreciation Cr Cash
The enterprise comply Statement of financial (reduce amount)
a non-monetary asset
with the conditions position
may be value at fair Statement of financial
attaching to them NCA: Cost-Accumulated Cumulative depreciation
value or nominal position
depreciation which would have been
value NCA: Cost-Accumulated
The grant will be NCL: Deferred income charged of the grant not
received CL: Deferred income depreciation been received
Should be charged as an
expense
GRANT FOR GRANT FOR NON Dr Asset
DEPRECIABLE DEPRECIABLE Cr Income statement
ASSET ASSET

Income over the

Income on the
cost of meeting
same
the obligation is Hockiemtoanonline.edu.vn 18
depreciated
incurred
 IAS 19 EMPLOYMENT BENEFITS
IAS 19 EMPLOYMENT BENEFITS

SHORT-TERM EMPLOYMENT BENEFITS POST EMPLOYMENT BENEFIT PLAN

For amounts to be settled within one year from the date
the work was completed DEFINED BENEFIT PLAN DEFINED CONTRIBUTION PLAN
Cost is charged to the period in which the work was done
E.g: Wages & salaries; sick leaves; Profit sharing & bonuses; Entity pay fixed contribution
non-monetary benefits (medical care, housing) The benefits are defined the size (regular contribution of a defined
of the post-employment benefits amount each year) into a
is determine in advance separate entity
SHORT-TERM PAID ABSENCES PROFIT SHARING/
BONUS PLAN
Entity has no legal or constructive
SHORT-TERM SHORT TERM NON The size of the contribution is obligation to pay further
ACCUMULATING ACCUMULATING Payable in 12 months set an amount that is expected contributions if the fund not holds
PAID ABSENCES PAID ABSENCES after the end of the sufficient assets to pay all
accounting period to earn enough investment
employee benefits
return to meet the obligation to
Can be carried Cannot be pay the post-employment
forward and used carried forward
and use in future Recognized as an benefits The post-employment benefits
in future paid to employees depend on the
expected cost when
plan’s investment performance.
the entity has a
E.g: unused
E.g: sick pay, paid present obligation to If the assets in the fund are
absence for pay it insufficient employer will be
holiday RECOGNITION
injury
required to make additional Unpaid
contributions contribution
No disclosure requirement CONTRIBUTION
(Liability)
RECOGNIESD AS
EXPENSE
RECOGNITION Excess
contribution
ACCURED EXPENSE Obligation settled no
EMPLOYMENT COST later than 12 months
(Assets)
(Liability)
NO DISCOUNTING
PREPAID EXPENSE
(Asset) Obligation settled
Hockiemtoanonline.edu.vn MORE than 12 months 19
DISCOUNTING
 IAS 12 – INCOME TAX

IAS 12 – INCOME TAX

Tax Expense Current Tax
INCOME TAXES PAYABLE in
respect of the taxable profit/loss
to the tax authorities.
(Adjust over and under provision
of prior period in current period)
TAX BASE
The tax base of an asset or liability is the amount attributed to that
asset or liability for tax purposes
TAX BASED OF ASSETS
Deferred Tax Expense The income taxes that would
be payable ( i.e in future
period ) in respect of the
taxable profit/loss to the tax
authorities.
DEFFERED TAX =
(CARRYING AMOUNT - TAX BASE) X TAX RATE
Tax rates that are expected to apply when the asset/liability will be
realized/settled
TAXABLE TEMPORARY DEDUCTABLE TEMPORARY
DIFFERENCES DIFFERENCES

Amount will be deductible for tax purpose When recovers the Results in DEDUCTIBLE
carrying amount of Results in TAXABLE AMOUNTS
against any taxable economic benefits that AMOUNTs in determining
the asset in determining taxable
will flow to an entity taxable profit/loss of future
profit/loss of future periods
periods
Tax base =
Economic will not be taxable DEFERRED TAX ASSET
carrying amount
These are the amounts of income
DEFERRED TAX LIABILITY
taxes recoverable in future periods
TAX BASED OF LIABILITIES These are the amounts of
in respect of all
income taxes payable in
 Deductible temporary differences
Any amount will be deductible for tax future periods.
Carrying amount of  Carry forward unused tax losses
purpose in respect of that liability in and credits.
liability LESS
future period

CARRYING VALUE TAX BASED

ASSETS Deferred tax liabilities Deferred tax asset

LIABILITIES Deferred tax assets Deferred tax liability

Hockiemtoanonline.edu.vn 20
 SCOPE
NOT APPLIED – IFRS 02,
IAS 17, IAS 02, IAS 36
APPLIED – IFRS 05
“The price that would receive to sell an asset or paid to transfer a liability in orderly transactions between market participations
In an ORDERLY
TRANSACTION
A transaction that
assumes exposure to
the market for a
period before the
measurement date to
allow for marketing
activities that are usual
and customary for
transactions involving
such assets or liabilities
It is not forced
transactions (e.g
forced liquidation or
distress sale)
IFRS 13 – FAIR VALUE MEASUREMENT
FAIR VALUE FAIR VALUE HIERARCHY
FAIR VALUE HIERARCHY SOME RULES
at the measurement date LEVEL 1 Level is given the
Quoted prices in active market HIGHEST
At the measureable date PRIORITY
Between MARKET PARTICIPANTS at the MEASUREMENT DATE MAXIMIZE
LEVEL 2
Inputs other than quoted prices those are OBSERVABLE
Buyers and seller in the PRINCIPLE MARKET (most advantages) for the asset or liabilities
directly or indirectly observable for the INPUT and
assets minimized
unobservable
LEVEL 3
PRINCIPLE MARKET Unobservable inputs for the assets input
The market with the greatest volume and level of CHARACTERISTICS OF BUYER AND SELLER
activity for the assets or liability
MOST ADVANTAGEOUS MARKET FAIR VALUE TECHNIQUES
INDEPENDENT
Market that SOME RULES
Not related parties MARKET APPROACH
maximizes - received to sell the assets or minimize
Used to value tangible assets that are not
When multiple
- paid to transfer liability
specialized because such assets have a valuation used,
AFTER TAKING TRANSACTION COST & TRANSPORT
COSTS
KNOWLEDGEABLE variety of uses management
Reasonable understanding evaluate the
INCOME APPROACH
Not generally used bcos the excess return results
The price used to Non financial assets –
ABLE TO TRANSACT IN THE ASSET OR in the expected cash flows are not and selects the
measure the fair highest and best use of
value of an asset the asset LIABLILITIES attribute to TANGIBLE ASSET but to the point with any
The market participant’s intangible assets, goodwill and business indicated range
or liability is not
ability to generate activities
adjusted for that is most
transaction costs economic benefits by
WILLING TO TRANSACT IN THE ASSET OR representative of
Because it are using/ selling to another COST APPROACH
characteristics of market participations who
LIABLITIY
Valuation techniques that reflects the fair value in the
Motivated but not forced other
a transactions will use the asset its amount that would be required currently circumstances
otherwise compelled to transact
highest and best use to replace the service capacity of an
If location is a assets (often referred to as current
characteristic of HIGHEST AND BEST USE replacement cost)
an assets -> Price Use of non-financial
is adjusted for the assets by market
costs that would participation that would FACTORS
be incurred to maximize the value of the CONSIDERED
transportation asset with which the asset Physical possible
the asset to the would be used Legally possible
FACTORS considered – Financial feasible
market
physical Hockiemtoanonline.edu.vn
Maximize values
21
 IAS 10 EVENT AFTER REPORTING REPORT DATE

ADJUSTING EVENT WHAT ? NON- ADJUSTING EVENT

Provide additional evidence of conditions Are those events, whether favorable or Do not affect the situation at the reporting
existing at the reporting date, will cause unfavorable, that occur between date, should not be adjusted for, but should
adjustments to be made to the assets be disclosed in the financial statements
and liabilities in the financial statements

EVENT AFTER Date

Adjust the financial statements
No disclosure reporting REPPORTING financial
date REPORT statemests
are
authorized
SOME KEY CONSIDERATION to issue

GOING CONCERN ISSUES ARISING AFTER BALANCE

SHEET DATE
An entity shall not prepare its financial statements
on a going concern basis IF management determines
after balance sheet date either that it intends to
liquidate the entity or to cease trading, or that it has
no realistic alternative but to do so.

PROPOSED DIVIDENDS
IAS 10 prevents proposed equity dividends being
recognized as liabilities unless they are declared
before the balance sheet date.
Declared that the dividend is appropriately
authorized, & is no longer at the discretion of the
enterprise.

Hockiemtoanonline.edu.vn 22
 IAS 08: CHANGE IN ACCOUNTING ESTIMATES, POLICY AND ERROR

CHANGE IN ACCOUNTING POLICY ERRORS CHANGE IN ACCOUNTING ESTIMATE

WHAT WHEN APPLIED? HOW APPLIED? Mathematical mistakes,
mistakes in applying WHAT HOW APPLIED?
accounting policies,
Specific Required by RETROSPECTIVELY oversights or
principles, bases, standard misinterpretations of
conventions,
rules and
Apply as if Adjust as facts, fraud. An adjustment of the PROSPECTIVELY
Result in more the new
practices reliable accounting
early as
RETROSPECTIVELY
carrying amount of an asset
adopted by an possible
entity in
information policy is or liability, or related The period of the change, if
applied all
preparing and this while Correcting the error as expense, resulting from the change affects that
presenting if the error had never
financial occurred
reassessing the expected period only; or
statements future benefits and The period of the change &
Correct all material
prior period errors
obligations associated with future periods, if the
HIERARCHY FOR retrospectively in the
first set of financial
that asset or liability change affects both
SELECTION OF statements authorized
for issue after their
discovery
ACCOUNTING EXAMPLE
Bad debts/provision for doubtful debts
POLICIES APPLY RETROSPECTIVELY
Adjust opening balance of reserve
Inventory obsolescence (IAS 2)
Restate comparatives The fair value of financial asset or financial
1. IASB standards & interpretations liabilities (IFRS 9)
2. The requirements in IFRSs dealing with
similar & related issues; The useful life of, or expected pattern of
3. The Framework and consumption of the future economic benefits
4. The most recent pronouncements of other
standard setting bodies that use a similar embodied in, depreciable assets (IAS 16); and
conceptual framework to develop Warranty obligations (IAS 37)
accounting standards;
5. Accepted industry practices. Repayment of government grant

Hockiemtoanonline.edu.vn 23

KEY DEFINITION
CLOSE FAMILY RELATIONSHIP
Family member – expected to influence/
be influence in dealing with entity
Parent or children
Dependents
COMPENSATION
Employment benefits in IAS 19
CONTROL
Power to govern policies to obtain
benefits from its activities
SIGNIFICANT INFLUENCE
Power to participate in financial &
operation decisions of entity
KEY MANAGEMENT PERSONNEL
Persons – authority & responsibility for
planning, directing, controlling activity of
an entity
IAS 24 RELATED PARTIES
RELATED PARTY
Person or entity that is related to entity that preparing its financial
statements
A PERSON ENTITY
Control / joint control over Member of a same group
reporting entity
Significant influence over the
Associate or joint venture of
the other entity
reporting entity
Member of key management
Both entities are joint ventures
of the same third parties
Member of key management
personnel
One is joint venture and other
is associate of the third party
Parent of the reporting entity
Post-employment benefit plan
for the benefit of employees of
reporting entity and entity
related
Entity is controlled or jointly
control by a person
Person identified in 1 has
significant influence over the
entity or member of the key
management personnel of the
entity
RELATED PARTY TRANSACTIONS
Transfer of resources, services, obligation between related parties,
REGARDLESS OF WHETHER A PRICE IS CHARGED OR NOT
Hockiemtoanonline.edu.vn
SCOPE
1. Identify related parties
relationship & transactions
2. Outstanding balances with
related parties
3. Circumstance disclosure 1
& 2 required and the
disclosure
EXCLUDE
1. Provider of finance, trade
unions, public utilizes,
government departments &
agencies (that do not control,
jointly control, significant
influence the reporting entity)
2. Customer, supplier,
distributors, general agents –
significant volume of business
3. Common directors or other
member of key management
The name of the government
and the nature of its
relationship with the
reporting entity (i.e., control,
joint control, or significant
influence)
DISCLOSURE
Purchases or sales of GOODS (FINISHED
OR UNFINISHED)
Rendering or receiving of SERVICES
LEASES
Transfer of RESEARCH AND
DEVELOPMENT
Transfers under LICENCE AGREEMENTS
Provision of FINANCE
Provision of GUARANTEES and collateral
security
SETTLEMENT OF LIABILITIES on behalf of
the entity or by the entity
KEY MANAGEMENT
PERSONNEL
COMPENSATION
Items of a similar NATURE may be
disclosed in aggregate unless separate
disclosure is necessary for an
understanding of the effect on the
financial statements
Disclosures that related party transactions
were made on terms equivalent to those
that prevail in arm's length transactions
are made only if such disclosures can24be
substantiated

DEFINITION
An operating segment is a component of an entity:
That engages in business activities from which it may
earn revenues & incur expenses (including revenues &
expenses relating to transactions with other components
of the same entity);
Whose operating results are reviewed regularly by the
entity’s chief operating decision maker to make
decisions about resources to be allocated to the segment
& assess its performance;
For which discrete financial information is available.
SCOPE
Separate AND the consolidated financial statements:
Whose debt or equity instruments are traded in a
PUBLIC MARKET; or
For the PURPOSE OF ISSUING ANY CLASS OF
INSTRUMENTS in a public market.
IFRS 08 – SEGEMENT REPORTING
REPORTABLE SEGMENTS
(CRITERIA)
(a) Has been identified as meeting the definition of an
operating segment; and
(b) Segment total is 10% OR MORE OF TOTAL:
(i) Revenue (internal and external), or
(ii) All segments not reporting a loss (or all segments in
loss if greater), or
(iii) Assets
CRITICISM OF IFRS 8
Some commentators have criticised the 'management
approach' as leaving segment identification too much to
the discretion of the entity.
The management approach may mean that financial
statements of different entities are not comparable.
Segment determination is the responsibility of directors
and is subjective.
Management may report segments which are not
consistent for internal reporting and control purposes.
Geographical information has been downgraded. It could
be argued that this breaks the link between a company and
its stakeholders.
There is no defined measure of segment profit or loss
Hockiemtoanonline.edu.vn
CORE PRINCIPLE
An entity should disclose information to enable users of its
financial statements to evaluate the nature & financial
effects of the types of business activities in which it
engages & the economic environments in which it
operates.
DISCLOSURE
Operating segment profit or loss
Segment assets
Segment liabilities
Certain income and expense items
AGGREGATION OF
OPERATING SEGMENTS
Two or more operating segments may be combined as a
single reportable segment if aggregation provides financial
statement users with information that allows them to
evaluate the business and the environment in which it
operates; they have similar economic characteristics; and
they are similar in each of the following respects:
products and services,
the production processes,
customer,
the methods used to distributibution, and
the nature of the regulatory environment
25
 IFRS 2 SHARE BASED PAYMENT

SCOPE EQUITY SETTLED SHARE BASED CASH SETTLED CHOICE OF

SHARE BASED SETTING IN
Equity settled share based MEASUREMENT WHEN CANCELLATION
MEASURE HOW CASH OR EQUITY
payment transaction
Received good or services in
return for share FV of the goods & Accelerated FV of the
GOODS SERVICE Recognized Incurred a liability to settle
service received charged to liability
when in cash/other assets
profit or loss of CASH SETTLED
Cash settled share share based The REMEASURE employee
FV of equity VEST DO NOT VEST UNTIL THE the
payment transactions date the at each provide
instrument granted IMMEDIATELY COUNTERPARTY COMPLETES A unauthorized
Acquiring goods or services entity reporting service No liability has been
SPECIFI PERIOD OF SERVICE balance of the
where prices are dependent on obtains date at fair (recognized incurred
Market Valuation options granted
share price the Recognize the
value over vesting EQUITY SETTLE
price technique service in full DURING Based on best
goods period)
Entity can settle the goods or on the grant VESTING available
date CHANGE DEFERRED TAX
PERIOD estimate of
services with either in cash or recognized in
Accounted as the number of
issuing equity instruments they are equity profit or loss
rendered by instruments Carrying amount of share-based
the expected to
0
payment expense
counterparty vest
during the Less: Tax based of share based
vesting period payment expense
(estimated amount tax authorities
(X)
ON VESTING Based on will permit as deduction in future
DATE number of period, based on year end
Revised the equity information)
estimate actually vest
Temporary difference (x)

Deffered tax assets x% X

26
 IAS 34 INTERIM FINANCIAL REPORTING

KEY DEFINITION KEY POINT CONSIDERED DISCLOSURE IN ANNUAL

INTERIM PERIOD
A financial reporting
period shorter than a
full financial year
ACCOUNTING POLICIES
The same accounting policies in the annual financial
statements
INTERIM FINANCIAL 1. Revenues that are received seasonally, cyclically or occasionally
REPORT within a financial year should not be treated differently from in the
Financial statements for annual financial statements.
an interim period 2. Costs & expenses are recognized as incurred & are not treated
differently than from in the annual financial statements.
3. Income tax expenses should be recognized based on the best
estimate of the weighted-average annual income tax rate expected for
the full financial year.
FINANCIAL STATEMENTS
If an estimate of an amount reported in an interim period is
changed significantly during the financial interim period in the
financial year but a separate financial report is not published for
that period, the nature & amount of that change must be disclosed
in the notes to the annual financial statements.
This is to ensure that so called ‘year-end adjustments’ are reported
in a transparent manner.

MATERIALITY It is recognized that the preparation of interim reports will often

Materiality is to be assessed in relation to the interim
period financial data, not forecasted annual data.
MEASUREMENT
Measurements for interim reporting purposes should be
made on a year-to-date basis, so that the frequency of
the enterprise’s reporting does not affect the
measurement of its annual results.
require the greater use of estimates.
DISCLOSURE IN INTERIM F/S
THE MINIMUM COMPONENTS
DISCLOSURE OF COMPLIANCE WITH IFRS
SPECIFIED FOR AN INTERIM If the entity’s interim financial report is in compliance with IAS 34,
that fact should be disclosed.
FINANCIAL REPORT
OTHER DISCLOSURES
Accounting policy changes
Condensed statement of financial position Seasonality or cyclicality of operations
Condensed statement of comprehensive income Unusual items & changes in estimates
Condensed statement of changes in equity Dividends paid & material events after the end of the interim
Condensed statement of cash flows period
Changes in the structure of the entity
Changes in contingent liabilities or assets
Issue, repurchase, & repayment of debt & equity
Obtaining or losing control of subsidiaries & long-term
investments, restructurings, & discontinued operations.

Hockiemtoanonline.edu.vn 27
 IFRS FOR SMEs

SCOPE KEY DIFFERENCES IN ACCOUNTING TREATMENT SIMPLIFICATIONS UNDER

Applies to SMEs that: BETWEEN FULL IFRS AND IFRS FOR SMES IFRS FOR SMEs
Do not have public accountability
&
Publish general purpose financial Omission Difference in accounting treatment PRESENTATION
statement Combined SOL and SOCIE permitted
EPS FINANCIAL INSTRUMENT No OCI and equity change other dividend and
“Basic” debt instrument => amortized cost profit after tax
Interim financial
Retained core principle of “full” IFRSs Investment in share => FVTP&L
statement
Segment reporting All other financial instrument => FVTP&L
Asset held for sale REVENUE RECOGNITION
NON-CURRENT ASSET Goods: Risks and reward transferred
Intangible asset => NOT APPLY REVALUATION MODEL Service: stage of completion basis
R&D expense => ALL RECORDED AS EXPENSE Tangible and goodwill always amortized (useful life
Investment property => FVTP&L not exceed 10 years)
Government grant => P&L
Borrowing cost => EXPENSE
SEPARATE FINANCIAL STATEMENT
DEFINIED BENEFIT PLAN Investment in subsidiary, associate or joint venture
Simplified calculation of benefit obligation =>
Actuarial gain or loss => P/L or OCI Cost or
PVTP&L
Equity method

GROUP FINANCIAL STATEMENT

Investment in subsidiary, associate or joint venture
=>
Cost or
PVTP&L
Equity method
NCI => % net asset (partial goodwill)

28
 IFRS 10 CONSOLIDATED FINANCIAL STATEMENT

OBJECTIVES CONSOLIDATED FINANCIAL STATEMENT

Establish principles for the presentation and preparation of = the financial statements of a group presented as those of a single
Consolidated
consolidated financial statements when an entity CONTROLS one or economic entity
more entities

Parent Subsidiary Group

CONSOLIDATED
ACCOUNTING INVESTMENT
FINANCIAL
REQUIREMENT ENTITY
STATEMENT

Separate FS Separate FS Consolidated FS

CONTROL
An inventor controls an investee when:
CONSOLIDATION PROCEDURES
Combine like items of assets, liabilities, equity, income, expenses and cash flows
Is exposed or has rights Step 1
Has the ability Through its Of the parent with those of subsidiaries
to variable returns from
to affect those power over the
its involvement in
returns investee
investee (= subsidiary )
Carrying amount of parent’s investment in subsidiary
Offset
= existing rights that give the current ability to affect Step 2
Power (eliminate)
the ralevant activities of investee
Parent’s portion of equity of each subsidiary

Step 3 Offset (eliminate) items related to intragroup transactions

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 IFRS 03 BUSINESS COMBINATION

KEY DEFINITION ACQUISITION METHOD CHANGE IN SHAREHOLDING

ACQUIRING ADDITIONAL
BUSINESS COMBINATION is a IDENTIFICATION OF THE ‘ACQUIRER’ PARTIAL DISPOSAL WHILE PARTIAL DISPOSAL WHILE COMBINATION
AFTER CONTROL
transaction or event in which an the combining entity that obtains control of the CONTROL IS RETAINED LOSS OF CONTROL ACHIEVED IN STAGES
OBTAINED
acquirer obtains control of one or more acquire.
This is accounted for as Re-measurement of the This is accounted for as an Prior to control being
business. an equity transaction residual holding to fair equity transaction with
ACQUISITION DATE obtained, the
the date on which the acquirer obtains control of the with owners value owners. investment is
Under IFRS 3, an acquirer must be acquiree Any difference between accounted for under
Gain or loss is not
identified for all business combination fair value & carrying Goodwill is not measured IAS 28, IFRS 09, as
recognized
ACQUISITION COSTS amount is a gain or loss appropriate.
on the disposal,
Costs of issuing debt or All other costs recognized in profit or On the date that
equity instruments are associated with the loss. control is obtained, the
accounted for under IAS acquisition must be fair values of the
39 & IFRS 9 expensed Thereafter, apply IAS 28, acquired entity’s
IAS 31, or IFRS 9, to the assets & liabilities,
remaining holding. including goodwill, are
measured (with the
option to measure full
GOODWILL OR A BARGAIN PURCHASE goodwill or only the
Consideration for the Changes to contingent
acquirer’s percentage
acquisition includes consideration resulting
Assets & liabilities are of goodwill).
THE AGGREGATE OF the acquisition-date from events after the
measured at their fair value of acquisition date must
acquisition-date contingent be recognized in profit Any resulting
The acquisition-date fair value of the
FAIR VALUE consideration. or loss. adjustments to
IDENTIFIABLE consideration transferred
previously recognized
ASSETS ACQUIRED The amount of any NCI assets & liabilities are
Fair value: sometimes called the
AND THE LIABILITIES Choice to recognized in profit or
In a business combination achieved in full goodwill method
measure loss.
stages, the acquisition-date fair value of NCI either
the acquirer’s previously held equity The NCI’s proportionate share of
at: net assets of the acquiree
interest in the acquiree;

If the difference above is negative, the resulting gain is recognized

as a bargain purchase in profit or loss

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 INCREASE IN SHAREHOLDING

INVESTMENT INVESTMENT ASSOCIATE ASSOCIATE SUBSIDIARY SUBSIDIARY

(IFRS 09) (IFRS 09) (IAS 28) (IAS 28) (IFRS 03) (IFRS 03)

SOFP SOFP SOFP

Similar between Investment in Investment in Determine goodwill
Individual and SOFP
associate associate Share profit of assciate
consolidated Compare Purchase
Transfer OCE in SOCI Added together after
financial statement consideration and NCI
separate financial Share profit of acquisition
purchased
statement of parent to associate SOCI
Transfer to OCE
RE in consolidate FS BASED ON % Share profit of
SOCI INTEREST IN associate

TRANSFER FROM OCE TO RE WHEN CHANGE IN RELATIONSHIP

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 IAS 28 – INVESTMENTS IN ASSOCIATE & JOINT VENTURES

SIGNIFICANT INDIVIDUAL FINANCIAL CONSOLIDATED FINANCIAL STATEMENT

INFLUENCE STATEMENTS OF INVESTOR
EQUITY INVESTMENT IN TRANSACTIONS WITH
EITHER ACCOUNTING ASSOCIATE ASSOCIATES OR JOINT VENTURES
Holds 20% or more of the
voting power (directly or According Equity
Cost OR Recognized at Profits and losses resulting from
through subsidiaries) to IFRS 09 method SOFP
cost upstream and downstream
OR in IAS 28 Cost + share
Adjusted for associate total transactions are eliminated to
change in the comprehensive the extent of the investor's
investor's share income interest in the associate or joint
of the venture.
investee's net Unrealized losses are not
assets SOCI recognized
Share associate
Share of the P&L Upstream Downstream
P&L and OCI Share associate
OCI Parent sell to Associate sell
associate to parent
Dr Retained Dr Retained
earning earnings of
Cr Investment parent
in associate Cr Group
Inventory

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 DECREASE IN SHAREHOLDING

SUBSIDIARY SUBSIDIARY ASSOCIATE ASSOCIATE INVESTMENT INVESTMENT

(IFRS 03) (IFRS 03) (IAS 28) (IAS 28) (IFRS 09) (IFRS 09)

NET ASSETS OF THE Carrying value of Carrying value of

FV OF INTEREST DISPOSAL at disposal ASSOCIATE
SUBSIDIARY AT DISPOSAL proportion sold
date
DATE
Net assets at disposal date +
Net assets + goodwill + FV Similar between
ADJUSTMENT (Goodwill; FV adjustment)
adjustment Individual and
consolidated
financial statement

Proceed received ASSETS ACQUIRED Proceed Proceed

Cash received + FV received + FV of received
STATEMENT OF interest remained + FV of retained interest
STATEMENT OF NCI at disposal date
COMPERHENSIVIE
FINANCIAL (if not sufficient
INCOME
POSITION information - % of asset
No change because
Increase - OCE disposal)
transfer between
Decrease - NCI
owner (parent & NCI)
TRANSFER FROM OCE TO RE WHEN
CHANGE IN RELATIONSHIP

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SEPARATE FINANCIAL STATEMENTS
KEY DEFINITION
FUNCTIONAL CURRENCY
The currency of the primary
economic environment in
which the entity operate
1. Mainly influence sale price
2. Competitor and regulations
determine sale price
3. Mainly labor, material &
other cost providing goods
PRESENTATION CURRENCY
Currency in which the financial
statements are presented
MONEYTARY ITEMS
Money held and assets,
liabilities to be received or paid
in fixed or determinable
number of unit currency
NON MONEYTARY ITEMS
All items presented in the SOFP
other than cash, claims to cash
and cash obligations
IAS 21 THE EFFECTS OF CHANGES IN FOREIGN EXCHANGE RATE
CONSOLIDATED FINANCIAL STATEMENT
INITIAL RECOGNITION INITIAL RECOGNITION CONVERT FINANCIAL STATEMENTS
Based on FUNCTIONAL
MONETARY ITEMS CHANGE IN FAIR
CURRENCY
VALUE OF
GOODWILL DUE
EXCHANGE RATE MONETARY ITEMS STATEMENT OF FINANCIAL
TO EXCHANGE
Exchange rate applied at the 1. Items are settled POSITION
date of the transactions 2. Translated at rates different when DIFFERENCE –
initially recognized OCE
AVERAGE RATE Reported in PROFIT OR LOSS IN THE Assets, Liabilities: reporting GOODWILL
Used if exchange rate not PERIOD, with ONE EXCEPTION date FAIR VALUE
Assess annual
fluctuate significantly ADJUSTMENT OF
EXEPCTION OF MONETARY ITEMS ASSETS - FV
Share capital, pre-acquisition assets at
SUBSEQUENT RECOGNITION monetary items that form part of the
retained earnings: acquisition acquisition date
reporting entity's net investment in a
date exchange rate and reporting
MONETARY ITEMS foreign operation are recognized, in the
consolidated financial statements that date due to
Closing rate Post-acquisition retained
include the foreign operation, in other exchange
earnings: average exchange
comprehensive income; difference – OCE
NON-MONEYTARY ITEMS rate
CARRIED AT HISTORY COST
Reported using the exchange they will be recognised in profit or loss Change between total assets - INCOME STATEMENT
rate at the date of the on disposal of the net investment total equity & liabilities:
transaction Exchange gain/loss - RE Average exchange
Net investment in a foreign operation rate – If insignificant
NON-MONETARY ITEMS
The amount refers to the reporting change
CARRIED AT FAIR VALUE
entity’s interest in the net assets of that
Reported at the rate that
foreign operation Others - Transaction
existed when the fair values
were determined exchange rate
NON-MONETARY ITEMS
Gain or loss on a non-monetary item is
recognized in OCI OR P&L (for example,
a property revaluation under IAS 16),
any foreign exchange component of
that gain or loss is also recognized in
OCI OR P&L
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 CONSOLIDATED STATEMENT OF COMPERHENSIVE INCOME

KEY RULES CONSOLIDATED SOCI

Less TOTAL sale of

Add together Add together REVENUE
intra-group

Intra group sale COST OF SALE Less TOTAL sale of

intra-group +
unrealized profit
Unrealized profit
Profit attribute to parent & NCI
Fair value adjustment
Total comprehensive income attribute to
parent & NCI
Investment in associate

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 CONSOLIDATED CASH FLOW STATEMENT
OPERATING
Impairment of goodwill
Gain on FV of prior interest not
recognized
Share profit of associate
P&L on financial assets
P&L on disposal FAs
P&L on sale of PPE
INVESTING FINANCING
Acquisition of subsidiary (cash of Right issue of sub to NCI
subsidiary)
Dividend paid of sub to NCI
Acquisition of associate
Dividend paid of parent
Purchase PPE (PPE of sub)
Proceeds of issue share of parent
Sale/Purchase of FAs
Dividend received

Employment cost

Share-based payment related expense

Cash paid to retirement benefit scheme

Change in inventory

Change in receivable

Change in payable

Cash generated from operations

Interest paid

Tax paid
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 The IFRS Conceptual Framework
OBJECTIVE OF FINANCIAL REPORTING
The users need information about:
- The economic resources of the entity
- The claims against the entity
- Changes in the entity’s economic resources and claims.
Underlying Assumption: GOING CONCERN
QUALITATIVE CHARACTERISTICS OF
USEFUL FINANCIAL INFO
FUNDAMENTAL QUALITATIVE CHARACTERISTICS
1. Relevance – predictive & confirmative value. Relevant
financial information is capable of making a difference in
the decisions made by users.
Materiality is an entity-specific aspect of relevance based
on the nature or magnitude (or both) of the items to
which the information relates in the context of an
individual entity’s financial report.
2. Faithful representation – seeks to maximize the
underlying characteristics of completeness, neutrality,
freedom from error)
ENHANCING QUALITATIVE CHARACTERISTICS
COMPARABILITY –compared with a similar information
about other entities & with similar information about the
same entity for another period or another date.
Verifiability – helps to assure users that information
represents faithfully the economic phenomena it purports
to represent. Verifiability means that different
knowledgeable & independent observers could reach
consensus, although not necessarily complete agreement,
that a particular depiction is a faithful representation.
TIMELINESS –available to decision-makers in time to be
capable of influencing their decisions.
UNDERSTANDABILITY – classifying, characterising &
presenting information clearly & consicely makes it
understandable. While some phenomena are inherently
complex & cannot be made easy to understand, to exclude
such information would make
MEASUREMENT OF THE ELEMENTS
HISTORICAL COST (BASED ON PAST TRANSACTION)
Assets are recorded at the amount of cash or cash
equivalents paid or the fair value of the consideration
given to acquire them at the time of their acquisition.
Liabilities are recorded at the amount of proceeds received
in exchange for the obligation, or in some circumstances, at
the amounts of cash or cash equivalents expected to be
paid to satisfy the liability in the normal course of business..
CURRENT COST: amount of cash or cash equivalents that
would have to be paid if the same or an equivalent asset
was acquired currently.
Liabilities are carried at the undiscounted amount of cash
or cash equivalents that would be required to settle the
obligation currently.
NET REALISABLE (SETTLEMENT) VALUE
Assets are carried at the amount of cash or cash equivalents
that could currently be obtained by selling the asset in an
orderly disposal.
Liabilities are carried at their settlement values; that is, the
undiscounted amounts of cash or cash equivalents
expected to be paid to satisfy the liabilities in the normal
course of business.
PRESENT VALUE (DISCOUNTED)
Assets are carried at the present discounted value of the
future net cash inflows that the item is expected to
generate in the normal course of business.
Liabilities are carried at the present discounted value of the
future net cash outflows that are expected to be required
to settle the liabilities in the normal course of business.
ELEMENTS OF FINANCIAL STATEMENTS
ELEMENTS OF FINANCIAL STATEMENTS
Asset – a resource controlled by the entity as a result of
past events & from which future economic benefits are
expected to flow to the entity.
Liability – a present obligation of the entity arising from
past events, the settlement of which is expected to result in
an outflow from the entity of resources embodying
economic benefits.
Equity – the residual interest in the assets of the entity after
deducting all its liabilities.
Income – increases in economic benefits during the
accounting period in the form of inflows or enhancements
of assets or decreases of liabilities that result in increases in
equity, other than those relating to contributions from
equity participants.
Expense – decreases in economic benefits during the
accounting period in the form of outflows or depletions of
assets or incurrences of liabilities that result in decreases in
equity, other than those relating to distributions to equity
participants.
ELEMENTS OF FINANCIAL STATEMENTS
RECOGNITION OF THE ELEMENTS OF FINANCIAL
STATEMENTS
 Firstly, it should meet the definition criteria
 Secondly, satisfies the following criteria :
o Probable that any future economic benefit
o cost or value that can be measured reliably
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 IAS 1 PRESENTATION OF FINANCIAL STATEMENTS
A COMPLETE SET OF FINANCIAL
STATEMENTS COMPRISES
Statement of financial position;
Statement of profit and loss and other
comprehensive income for the period;
Statement of changes in equity for the
period;
Statement of cash flows for the period;
Notes, comprising a summary of significant
accounting policies and other explanatory
information;
COMPARATIVE INFORMATION
a statement of financial position as at the
beginning of the earliest comparative period
when an entity applies an accounting policy
retrospectively or makes a retrospective
restatement of items in its financial
statements, or when it reclassifies items in its
financial statements
GENERAL REQUIREMENT WHEN PREPARING FINANCIAL STATEMENT
GOING CONCERN
When preparing financial statements,
management shall make an assessment of an
entity’s ability to continue as a GOING
CONCERN.
STATEMENT OF FINANCIAL
POSITION
CURRENT ASSETS
Expected to be realised in the entity's
normal operating cycle
Held for trading
Realised within 12 months after the reporting
period
Cash and cash equivalents
CURRENT LIABILITIES
settled within the entity's normal operating
cycle
Settled within 12 months
the entity does not have an unconditional
right to defer settlement beyond 12 months
ACCRUAL BASIS OF ACCOUNTING
IAS 1 requires that an entity prepare its
financial statements, except for cash flow
information, using the ACCRUAL BASIS OF
ACCOUNTING
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STATEMENT OF
COMPERHENSIVE INCOME
STATEMENT OF PROFIT OR LOSS
An entity may present the profit or loss
section in a separate statement of profit or
loss. (INCOME – EXPENSE)
THE OTHER COMPREHENSIVE INCOME
present line items for amounts of other
comprehensive income in the period,
classified by nature in accordance with other
IFRSs:
will not be reclassified subsequently to
profit or loss; and
will be reclassified subsequently to profit
or loss when specific conditions are met.
SEPARATELY EACH MATERIAL CLASS OF
SIMILAR ITEMS
An entity shall present separately each
material class of similar items.
An entity shall present separately items of a
dissimilar nature or function unless they are
immaterial.
NOTES
Present information about the basis of
preparation of the financial statements and
the specific accounting policies used
Provide information that is not presented
elsewhere in the financial statements, but is
relevant to an understanding of any of them.
An entity shall disclose information that
enables users of its financial statements to
evaluate the entity’s objectives, policies and
processes for managing capital.
An entity shall also provide additional
disclosures on puttable financial instruments
classified as equity instruments.
NOT OFFSET ASSETS AND LIABILITIES OR
INCOME AND EXPENSES
An entity shall not offset assets and liabilities
or income and expenses, unless required or
permitted by an IFRS.
PRESENT AT LEAST ANNUALLY
Present a complete set of financial
statements (including comparative
information) at least annually.
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 INTERPRETATION OF FINANCIAL STATEMENTS
FINANCIAL REPORTING
FINANCIAL RATIO
Profitability (profit margin, ROCE, ROE)
Efficiency (Asset turnover)
Investor (EPS, P/E ratio, Dividend yield,
dividend cover, dividend payout rate)
Liquidity (Current and quick ratio, inventory
day, receivable day, payable day)
EPS
Basic EPS
Diluted EPS
OTHER PERFORMANCE MEASUREMENT
EBITDA: Earning before interest, tax,
depreciation & amortization
Indicate of management performance
EVA: Economic value added
Operating profit – tax – cost of capital
Benchmarking: compare with best practice or
industry standard
Might be manipulation
FINANCIAL REPORTING FINANCIAL REPORTING
REASONS FOR REPORTING WHAT
Increased role of business in society Concise report focusing on value creation in
Want to understand how entities do business short, medium and long term
CURRENT REPORTING REQUIREMENT FUNDAMENTAL CONCEPTS
No IFRS requirements Value creation
Some national requirements Capitals
Some company voluntary disclosure Value creation report
Global reporting initiative (GRI)
GUIDING PRINCIPLES
SOCIAL AND ENVIRONMENT DISCLOSURE Strategic focus and future operation
ADVANTAGES Connectivity of information
Investor relation & confidence Stakeholder relationship
Competitive advantages Materiality
Public recognition Conciseness
Improved risk management Reliability and completeness
Access to “preferred suppliers” lists Consistency and comparability
Cost savings/ improved profitability
DISADVANTAGES REPORTING CONTENT
Market comes to expect it 1. Organizational overview & external
Negative impact if only partial disclosure stakeholder
2. Governance
3. Business model
MANAGEMENT COMMENTARY
4. Risks and opportunities
Investor relation & confidence
5. Strategy and resource
Explains corporate performance
6. Performance
Future financial position
7. Future outlook
IFRS practice statement => principles for
8. Basis of preparation and presentation
preparation of management commentary
GENERAL DISCLOSURE REQUIREMENT
Material matters
Disclosure about the capitals
Time frame for short, medium, and long-term 39
Aggregation & disaggregation
 PROFESSIONAL & ETHICAL ISSUES
Complying with accounting
Ethical principles Morality & ethics
standards
ACCA CONDUCT OF ETHIC THREAT TO PROFESSIONAL COMPETENCE ETHICAL THEORY
Objectivity Insufficient time Ethical relativism: ethical change overtime
Integrity Incomplete, inadequate information Ethical absolutism: ethical does not
Professional competence & due care Insufficient experience, training or change overtime
Confidently education Kholberg’s ethical through process: act
Professional behavior Inadequate resources ethically because
Punished if do not
THREAT TO FUNDAMENTAL PRINCIPLE Law say
FRAMEWORK FOR DECISION Right to do so
Self interest
1. Real issue? Influences on ethic
Self-review
2. Threats to compliance with principles Individual: age, education
Advocacy
3. Threats significant? Social: entity cultural
Familiarity
4. Safeguards reduce to acceptable level?
Intimidation
SOCIAL RESPONSBILITY
ETHICAL THEORY
PROHIBITION WITH REPORT THAT Ethical relativism: ethical change overtime
Material misleading Ethical absolutism: ethical does not
Contain reckless information change overtime
Are biased Kholberg’s ethical through process: act
Omit/obscure information ethically because
Punished if do not
Law say
Right to do so
Influences on ethic
Individual: age, education
Social: entity cultural

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