Introduction and the Framework


Part of Phase B of Financial Statement Presentation project



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Part of Phase B of Financial Statement Presentation project

  • Looking Ahead
  • Part of Phase B of Financial Statement Presentation project
  • Likely to link related items on each financial statement; e.g., business items (operating and investing) and financing items
  • May move to explain change in cash only – exclude cash equivalents
  • May require use of direct method on statement with reconciliation to profit or loss in the notes
  • Phase B discussion paper issued in late 2008
  • End-of-Chapter Practice
  • End-of-Chapter Practice
  • 3-3 Companies are affected by a number of events and transactions, some of which have an effect on their cash and cash equivalents, and some which do not. Following are some examples of such events and transactions:
  • Annual payment of $100 on a finance lease obligation, $2 of which is interest
  • Acquisition of a 4100, 3%, 90-day government treasury bill
  • Payment of $25 to a pension fund trustee
  • Cash received on the maturity of the treasury bill in item 2 above
  • Annual payment of $100 on an operating lease for sales office space
  • Receipt of $10 on the sublease of excess sales office space
  • Acquisition of the company’s treasury shares at a cost of $75
  • Conversion of convertible debt into common shares
  • Payment of $30 of a portion of long-term debt reported in current liabilities along with $3 of interest
  • Costs incurred to repair a customer’s product under warranty—inventory supplies used $1; labor paid $4
  • Instructions
  • For each item listed above
  • identify the effect on the company’s cash and cash equivalents; and
  • indicate how the transaction or event will be reported on the company’s statement of cash flows, if at all, and if any special disclosures are required.
  • End-of-Chapter Practice

3-5 In this chapter, flag icons identify areas where there are GAAP differences between IFRS requirements and national standards.

  • End-of-Chapter Practice
  • 3-5 In this chapter, flag icons identify areas where there are GAAP differences between IFRS requirements and national standards.
  • Instructions
  • Access the website(s) identified on the inside back cover of this book, and prepare a concise summary of the differences that are flagged throughout the chapter.
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  • Non-current Assets Held for Sale and Discontinued Operations: IFRS 5

Related standards

  • Non-current Assets Held for Sale and Discontinued Operations
  • Related standards
  • IFRS 5
  • Current GAAP comparisons
  • IFRS financial statement disclosures
  • Looking ahead
  • End-of-chapter practice
  • Related Standards
  • FAS 144 Accounting for the impairment or disposal of long-lived assets
  • FAS 131 Disclosures about segments of an enterprise and related information
  • Related Standards
  • IFRS 8 Operating segments
  • IAS 36 Impairment of assets
  • IAS 1 Presentation of financial statements

Objective and scope

  • IFRS 5 - Overview
  • Objective and scope
  • Classification as held for sale
  • Measurement
  • Presentation and disclosure

Standards for non-current assets with carrying values to be recovered through sale rather than use

  • IFRS 5 – Objective and Scope
  • Standards for non-current assets with carrying values to be recovered through sale rather than use
  • Covers classification, measurement, presentation of assets held for sale, and reporting of discontinued operations

  • IFRS 5 – Objective and Scope
  • Assets held for sale: refers to all such recognized non-current assets, and includes cash-generating units called disposal groups that may include current and non-current assets and liabilities
  • Discontinued operation: a component of an entity that either has been disposed of or is classified as held for sale

Stringent conditions:

  • Stringent conditions:
  • Available for immediate sale in existing condition
  • Sale must be highly probable
  • Likely that significant change will not be made to the plan
  • Sale transaction will take place within one year from classification as held for sale


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