The document discusses two International Accounting Standards: IAS 36 Impairment of Assets and IAS 40 Investment Property.
IAS 36 provides guidance on recognizing and measuring impairment losses on assets. An impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount, defined as the higher of an asset's fair value less costs to sell or its value in use.
IAS 40 provides the accounting requirements for investment property, which is property held to earn rentals or for capital appreciation. Investment property can be measured initially at cost and subsequently using either the fair value model or cost model.
Khalid Aziz offers coaching classes for commerce students studying various subjects including accounting, economics, business mathematics, and statistics. He also provides coaching for professional qualifications like ICMAP, ICAP, ACCA, CAT, and MA-Economics. Khalid Aziz has over 12 years of coaching experience and 100% student success rates in 2011-2012. He can be contacted at his listed address and phone number in Karachi, Pakistan.
This document provides an overview of IND AS 103 on business combinations. It discusses the key principles, including:
1) All business combinations must be accounted for using the acquisition (purchase) method, which requires identifying an acquirer and measuring acquisition date fair values of the acquiree's assets and liabilities.
2) Goodwill arises when the consideration transferred exceeds the net fair values recognized and is not amortized but tested annually for impairment.
3) The acquirer recognizes the acquiree's identifiable assets, liabilities and contingent liabilities at their acquisition-date fair values. Any excess of cost over fair value is recognized as goodwill.
IAS 40 provides guidance on accounting for investment property, which is property held to earn rentals or for capital appreciation rather than for use in production. It requires investment property to be initially measured at cost and then either at fair value or cost model after initial recognition. Under the fair value model, all changes in fair value are recognized in profit or loss for the period. The standard also provides guidance on transfers, disposals, disclosures and transitional provisions for investment property.
This document summarizes IAS 40 on investment property. It defines investment property as property held to earn rentals or for capital appreciation rather than for use in production. It outlines the classification, recognition, measurement and disclosure requirements for investment property according to IAS 40, including initial measurement at cost and the option to use the fair value model or cost model for subsequent measurement. It also discusses transfers, disposals and specific disclosure requirements.
The document defines fair value and outlines the framework for measuring fair value according to IFRS 13. It discusses key aspects such as:
- Fair value is a market-based exit price between market participants at the measurement date.
- The asset or liability is assumed to be exchanged in the principal or most advantageous market.
- Highest and best use must be considered, whether the asset is used individually or in combination with others.
- A fair value hierarchy gives the highest priority to Level 1 inputs and the lowest to Level 3 inputs.
- Valuation techniques use observable inputs where possible and unobservable inputs only when necessary.
This standard outlines the accounting treatment and disclosure requirements for investment property. It defines investment property as property held to earn rentals or for capital appreciation rather than for short-term sale or use in production. The standard specifies that investment property is initially recognized at cost and can be subsequently measured using either the cost or fair value model. It also provides guidance on transfers to or from investment property, disposal of investment property, and impairment of investment property. Extensive disclosure requirements are specified regarding investment property balances, fair values, rental income and expenses, and restrictions.
This document discusses key concepts related to business combinations, including defining a business combination, applying the acquisition method, determining goodwill, assessing goodwill impairment, and identifying the acquirer. It provides learning objectives and definitions from IFRS 3 and ASPE related to business combinations. Examples are provided to illustrate accounting for asset acquisitions, share acquisitions, and amalgamations. The calculation and subsequent accounting for goodwill and non-controlling interests are also summarized.
Khalid Aziz offers coaching classes for commerce students studying various subjects including accounting, economics, business mathematics, and statistics. He also provides coaching for professional qualifications like ICMAP, ICAP, ACCA, CAT, and MA-Economics. Khalid Aziz has over 12 years of coaching experience and 100% student success rates in 2011-2012. He can be contacted at his listed address and phone number in Karachi, Pakistan.
This document provides an overview of IND AS 103 on business combinations. It discusses the key principles, including:
1) All business combinations must be accounted for using the acquisition (purchase) method, which requires identifying an acquirer and measuring acquisition date fair values of the acquiree's assets and liabilities.
2) Goodwill arises when the consideration transferred exceeds the net fair values recognized and is not amortized but tested annually for impairment.
3) The acquirer recognizes the acquiree's identifiable assets, liabilities and contingent liabilities at their acquisition-date fair values. Any excess of cost over fair value is recognized as goodwill.
IAS 40 provides guidance on accounting for investment property, which is property held to earn rentals or for capital appreciation rather than for use in production. It requires investment property to be initially measured at cost and then either at fair value or cost model after initial recognition. Under the fair value model, all changes in fair value are recognized in profit or loss for the period. The standard also provides guidance on transfers, disposals, disclosures and transitional provisions for investment property.
This document summarizes IAS 40 on investment property. It defines investment property as property held to earn rentals or for capital appreciation rather than for use in production. It outlines the classification, recognition, measurement and disclosure requirements for investment property according to IAS 40, including initial measurement at cost and the option to use the fair value model or cost model for subsequent measurement. It also discusses transfers, disposals and specific disclosure requirements.
The document defines fair value and outlines the framework for measuring fair value according to IFRS 13. It discusses key aspects such as:
- Fair value is a market-based exit price between market participants at the measurement date.
- The asset or liability is assumed to be exchanged in the principal or most advantageous market.
- Highest and best use must be considered, whether the asset is used individually or in combination with others.
- A fair value hierarchy gives the highest priority to Level 1 inputs and the lowest to Level 3 inputs.
- Valuation techniques use observable inputs where possible and unobservable inputs only when necessary.
This standard outlines the accounting treatment and disclosure requirements for investment property. It defines investment property as property held to earn rentals or for capital appreciation rather than for short-term sale or use in production. The standard specifies that investment property is initially recognized at cost and can be subsequently measured using either the cost or fair value model. It also provides guidance on transfers to or from investment property, disposal of investment property, and impairment of investment property. Extensive disclosure requirements are specified regarding investment property balances, fair values, rental income and expenses, and restrictions.
This document discusses key concepts related to business combinations, including defining a business combination, applying the acquisition method, determining goodwill, assessing goodwill impairment, and identifying the acquirer. It provides learning objectives and definitions from IFRS 3 and ASPE related to business combinations. Examples are provided to illustrate accounting for asset acquisitions, share acquisitions, and amalgamations. The calculation and subsequent accounting for goodwill and non-controlling interests are also summarized.
This document summarizes IAS 36 on impairment of assets. The key points are:
1) IAS 36 aims to ensure assets are carried at no more than their recoverable amount, which is defined as the higher of an asset's fair value less costs of disposal and its value in use.
2) An impairment loss occurs when an asset's carrying amount exceeds its recoverable amount and must be recognized.
3) Recoverable amount is determined based on external factors like market changes or internal factors like physical damage.
4) A cash-generating unit is the smallest group of assets that generates cash inflows independently of other assets.
When to Consolidate and When not to?
Acquisition Method
Inter-company Entries
Consolidation Working Paper
Combined Financial Statements and how do they differ from Consolidated Financial Statements
Adjustments in Detail
Ind AS 18 provides guidance on accounting for revenue. It aims to determine when to recognize revenue. Revenue is recognized when future economic benefits flow to the entity and can be reliably measured.
The standard addresses revenue recognition for sale of goods, rendering of services, and interest, royalties or dividends. For sale of goods, revenue is recognized when risks and rewards of ownership transfer. For services, revenue is recognized by reference to completion percentage. Interest is recognized using effective interest rate method, while royalties and dividends are recognized on an accrual basis.
The document also discusses concepts like deferred payment terms, non-cash transactions, and components of transactions. Disclosures required include revenue categories, accounting policies,
This document provides an overview of Ind AS 38 on Intangible Assets. It discusses the objective and scope, key definitions, recognition and measurement criteria, disclosure requirements, and differences between Ind AS 38 and the previous Accounting Standard AS 26. Some of the key points covered include defining an intangible asset, the criteria for recognition of intangible assets, measurement at cost or revaluation model, amortization periods, impairment testing, and additional disclosures required under Ind AS 38.
This document summarizes IAS 18 on revenue recognition and IFRS 5 on non-current assets held for sale. IAS 18 establishes guidelines for recognizing revenue from sales of goods, services rendered, and interest, royalties and dividends. It defines revenue and outlines exceptions. IFRS 5 provides criteria for classifying non-current assets as held for sale and guidelines for measurement, disclosure, and presentation of discontinued operations. A non-current asset is classified as held for sale if its carrying amount will be recovered through a sale transaction that is highly probable within one year.
This document discusses accounting standards related to non-current assets. It covers IAS 16 on property, plant, and equipment; IAS 40 on investment property; accounting for intangible assets under IAS 38; impairment of assets under IAS 36; and classification and measurement of non-current assets held for sale under IFRS 5. The standards address initial recognition, subsequent measurement, depreciation, impairment reviews, and disclosure requirements for these types of non-current assets.
This document summarizes key differences between IFRS and US GAAP regarding accounting for intangible assets. Some of the main points covered include:
- IFRS permits periodic revaluation of intangible assets to fair value, while US GAAP does not allow revaluation.
- IFRS requires capitalization of development costs when technical and economic feasibility can be demonstrated, while most development costs are expensed under US GAAP.
- There have been efforts to converge the standards but projects to fully eliminate differences have not been undertaken.
IAS 28 outlines the accounting requirements for investments in associates and joint ventures. It requires entities with significant influence or joint control over an investee to use the equity method to account for the investment. The equity method involves initially recognizing the investment at cost and subsequently adjusting the carrying amount to reflect the investor's share of the profits or losses and other comprehensive income of the associate or joint venture. The standard provides guidance on determining significant influence and joint control and examples of applying the equity method.
Ind AS 103 establishes principles and requirements for how an acquirer recognizes and measures identifiable assets acquired, liabilities assumed, and any non-controlling interest in an acquiree. It also provides guidance on how to recognize and measure goodwill or gain on a bargain purchase. The standard applies to business combinations but not to acquisitions of assets or groups of assets that do not constitute a business. Under the acquisition method, the acquirer recognizes and measures identifiable assets acquired and liabilities assumed at their acquisition-date fair values.
This document provides an overview of IAS 16, which establishes the accounting requirements for property, plant and equipment. It defines key terms, outlines the requirements for recognition, measurement, depreciation, impairment, derecognition and disclosure of property, plant and equipment. The standard aims to prescribe the accounting treatment for PPE, including how to determine the carrying amount and calculate depreciation charges and impairment losses. It applies to tangible items used in operations or for administrative purposes that are expected to be used for more than one period.
This document provides an overview of Ind AS 36 - Impairment of Assets. It begins with an agenda outlining the key topics to be covered, including objective and scope, definitions, recognition and measurement requirements, required disclosures, differences between Ind AS 36 and the corresponding Indian accounting standard AS 28, and the potential impact on ILGIC. Some of the main points covered include: assets within the scope of Ind AS 36, the definition of impairment and key terms, procedures for identifying and measuring impairment losses, impairment loss allocation methods, and additional annual testing required under Ind AS 36 for certain assets.
The document summarizes IFRS 3 Business Combinations. It discusses the scope and application of the purchase method for business combinations, including identifying the acquirer, determining the cost of the business combination, and allocating the cost to assets and liabilities. It also covers goodwill, impairment testing, valuation considerations, transition guidance, and tax effects of business combinations.
This document provides an overview of IFRS 11 - Joint Arrangements and Associates. It defines joint arrangements as arrangements where two or more parties have joint control based on a contractual agreement. Joint arrangements are classified as either a joint operation or a joint venture depending on the parties' rights and obligations. For a joint operation, parties account for their share of assets, liabilities, revenue and expenses. For a joint venture, parties account for their interest as an investment using the equity method. Examples of each type of arrangement are also provided.
The document provides an overview of IAS 36 Impairment of Assets, including the standard's objective to ensure assets are reported at no more than their recoverable amount. It discusses identifying impaired assets, calculating recoverable amount, recognizing impairment losses, reversing impairments, and disclosure requirements. Examples are provided for testing assets and cash-generating units for impairment.
The document provides an overview of IAS 36 Impairment of Assets. Key points include:
1) IAS 36 provides guidance for determining when the carrying amount of an asset exceeds its recoverable amount and an impairment loss must be recognized. It excludes certain assets and requires annual impairment testing of goodwill and indefinite-lived intangible assets.
2) An impairment loss is recognized when the recoverable amount of an asset or cash-generating unit is less than its carrying amount. The recoverable amount is the higher of an asset's fair value less costs to sell or its value in use.
3) Impairment losses are allocated first to reduce the carrying amount of goodwill allocated to
Here are the answers to the objective type questions on corporate accounting:
1. Payment of dividend.
2. Redemption of Preference shares.
3. Dividend is not payable on the calls paid in advance by a shareholder.
4. Share premium Account appears on the liability side of the balance sheet.
5. Amount called by the company and paid for is forfeited.
6. Capital Reserve.
7. Called up amount.
8. Writing-off Preliminary expense.
9. A company can redeem only fully paid preference share.
10. Issue fully paid bonus shares.
11. At a pre-determined fixed rate.
12. Premium on issue of
IND AS 103 provides guidance on accounting for business combinations. It outlines a 5 step process: 1) identify the acquirer and acquisition date, 2) measure consideration transferred, 3) recognize identifiable assets acquired and liabilities assumed, 4) recognize non-controlling interests, and 5) recognize resulting goodwill or gain on bargain purchase. Consideration includes assets given, liabilities incurred, and equity instruments issued, measured at fair value. Identifiable assets and liabilities are recognized and measured at fair value. Non-controlling interests may be measured at fair value or proportionate share of net assets. Goodwill is recognized as the excess of consideration over fair values. Adjustments may be made to reflect new information for up to one
The document discusses the key differences between existing AS 14 (Accounting for Amalgamations) and the revised Exposure Draft of AS 14 on business combinations. Some major differences include:
1. The revised standard applies the acquisition method, requiring identifiable assets acquired and liabilities assumed to be measured at fair value on the acquisition date.
2. It provides more guidance on accounting for contingent consideration, bargain purchases, step acquisitions, and transaction costs.
3. Additional disclosures are required to enable users to evaluate the nature and financial effects of business combinations.
Chap 5 IAS 40 - Investment Property.pptxKashif Butt
IAS 40 provides guidance on accounting for investment property. Investment property is property held to earn rentals or for capital appreciation. It can be measured using either the fair value model or cost model. The fair value model remeasures properties to fair value through profit or loss. The cost model measures properties similarly to property, plant, and equipment. Transfers between categories are accounted for depending on the models used. Extensive disclosures are required regarding investment properties.
Ias 16 property plant and equipment-presentationShadabAhmadFaiq
The document discusses the key aspects of IAS 16 Property, Plant and Equipment including:
- The objective is to prescribe the accounting treatment for property, plant and equipment.
- Scope outlines what is excluded like IFRS 5 and IAS 40.
- Definitions for terms like PPE, carrying amount, depreciation.
- Recognition criteria that future benefits are probable and cost can be reliably measured.
- Measurement includes initial cost and subsequent cost model or revaluation model.
- Depreciation is systematically allocated over useful life.
- Impairment is assessed using IAS 36.
- Derecognition occurs from disposal or no future benefits are expected.
This document summarizes IAS 36 on impairment of assets. The key points are:
1) IAS 36 aims to ensure assets are carried at no more than their recoverable amount, which is defined as the higher of an asset's fair value less costs of disposal and its value in use.
2) An impairment loss occurs when an asset's carrying amount exceeds its recoverable amount and must be recognized.
3) Recoverable amount is determined based on external factors like market changes or internal factors like physical damage.
4) A cash-generating unit is the smallest group of assets that generates cash inflows independently of other assets.
When to Consolidate and When not to?
Acquisition Method
Inter-company Entries
Consolidation Working Paper
Combined Financial Statements and how do they differ from Consolidated Financial Statements
Adjustments in Detail
Ind AS 18 provides guidance on accounting for revenue. It aims to determine when to recognize revenue. Revenue is recognized when future economic benefits flow to the entity and can be reliably measured.
The standard addresses revenue recognition for sale of goods, rendering of services, and interest, royalties or dividends. For sale of goods, revenue is recognized when risks and rewards of ownership transfer. For services, revenue is recognized by reference to completion percentage. Interest is recognized using effective interest rate method, while royalties and dividends are recognized on an accrual basis.
The document also discusses concepts like deferred payment terms, non-cash transactions, and components of transactions. Disclosures required include revenue categories, accounting policies,
This document provides an overview of Ind AS 38 on Intangible Assets. It discusses the objective and scope, key definitions, recognition and measurement criteria, disclosure requirements, and differences between Ind AS 38 and the previous Accounting Standard AS 26. Some of the key points covered include defining an intangible asset, the criteria for recognition of intangible assets, measurement at cost or revaluation model, amortization periods, impairment testing, and additional disclosures required under Ind AS 38.
This document summarizes IAS 18 on revenue recognition and IFRS 5 on non-current assets held for sale. IAS 18 establishes guidelines for recognizing revenue from sales of goods, services rendered, and interest, royalties and dividends. It defines revenue and outlines exceptions. IFRS 5 provides criteria for classifying non-current assets as held for sale and guidelines for measurement, disclosure, and presentation of discontinued operations. A non-current asset is classified as held for sale if its carrying amount will be recovered through a sale transaction that is highly probable within one year.
This document discusses accounting standards related to non-current assets. It covers IAS 16 on property, plant, and equipment; IAS 40 on investment property; accounting for intangible assets under IAS 38; impairment of assets under IAS 36; and classification and measurement of non-current assets held for sale under IFRS 5. The standards address initial recognition, subsequent measurement, depreciation, impairment reviews, and disclosure requirements for these types of non-current assets.
This document summarizes key differences between IFRS and US GAAP regarding accounting for intangible assets. Some of the main points covered include:
- IFRS permits periodic revaluation of intangible assets to fair value, while US GAAP does not allow revaluation.
- IFRS requires capitalization of development costs when technical and economic feasibility can be demonstrated, while most development costs are expensed under US GAAP.
- There have been efforts to converge the standards but projects to fully eliminate differences have not been undertaken.
IAS 28 outlines the accounting requirements for investments in associates and joint ventures. It requires entities with significant influence or joint control over an investee to use the equity method to account for the investment. The equity method involves initially recognizing the investment at cost and subsequently adjusting the carrying amount to reflect the investor's share of the profits or losses and other comprehensive income of the associate or joint venture. The standard provides guidance on determining significant influence and joint control and examples of applying the equity method.
Ind AS 103 establishes principles and requirements for how an acquirer recognizes and measures identifiable assets acquired, liabilities assumed, and any non-controlling interest in an acquiree. It also provides guidance on how to recognize and measure goodwill or gain on a bargain purchase. The standard applies to business combinations but not to acquisitions of assets or groups of assets that do not constitute a business. Under the acquisition method, the acquirer recognizes and measures identifiable assets acquired and liabilities assumed at their acquisition-date fair values.
This document provides an overview of IAS 16, which establishes the accounting requirements for property, plant and equipment. It defines key terms, outlines the requirements for recognition, measurement, depreciation, impairment, derecognition and disclosure of property, plant and equipment. The standard aims to prescribe the accounting treatment for PPE, including how to determine the carrying amount and calculate depreciation charges and impairment losses. It applies to tangible items used in operations or for administrative purposes that are expected to be used for more than one period.
This document provides an overview of Ind AS 36 - Impairment of Assets. It begins with an agenda outlining the key topics to be covered, including objective and scope, definitions, recognition and measurement requirements, required disclosures, differences between Ind AS 36 and the corresponding Indian accounting standard AS 28, and the potential impact on ILGIC. Some of the main points covered include: assets within the scope of Ind AS 36, the definition of impairment and key terms, procedures for identifying and measuring impairment losses, impairment loss allocation methods, and additional annual testing required under Ind AS 36 for certain assets.
The document summarizes IFRS 3 Business Combinations. It discusses the scope and application of the purchase method for business combinations, including identifying the acquirer, determining the cost of the business combination, and allocating the cost to assets and liabilities. It also covers goodwill, impairment testing, valuation considerations, transition guidance, and tax effects of business combinations.
This document provides an overview of IFRS 11 - Joint Arrangements and Associates. It defines joint arrangements as arrangements where two or more parties have joint control based on a contractual agreement. Joint arrangements are classified as either a joint operation or a joint venture depending on the parties' rights and obligations. For a joint operation, parties account for their share of assets, liabilities, revenue and expenses. For a joint venture, parties account for their interest as an investment using the equity method. Examples of each type of arrangement are also provided.
The document provides an overview of IAS 36 Impairment of Assets, including the standard's objective to ensure assets are reported at no more than their recoverable amount. It discusses identifying impaired assets, calculating recoverable amount, recognizing impairment losses, reversing impairments, and disclosure requirements. Examples are provided for testing assets and cash-generating units for impairment.
The document provides an overview of IAS 36 Impairment of Assets. Key points include:
1) IAS 36 provides guidance for determining when the carrying amount of an asset exceeds its recoverable amount and an impairment loss must be recognized. It excludes certain assets and requires annual impairment testing of goodwill and indefinite-lived intangible assets.
2) An impairment loss is recognized when the recoverable amount of an asset or cash-generating unit is less than its carrying amount. The recoverable amount is the higher of an asset's fair value less costs to sell or its value in use.
3) Impairment losses are allocated first to reduce the carrying amount of goodwill allocated to
Here are the answers to the objective type questions on corporate accounting:
1. Payment of dividend.
2. Redemption of Preference shares.
3. Dividend is not payable on the calls paid in advance by a shareholder.
4. Share premium Account appears on the liability side of the balance sheet.
5. Amount called by the company and paid for is forfeited.
6. Capital Reserve.
7. Called up amount.
8. Writing-off Preliminary expense.
9. A company can redeem only fully paid preference share.
10. Issue fully paid bonus shares.
11. At a pre-determined fixed rate.
12. Premium on issue of
IND AS 103 provides guidance on accounting for business combinations. It outlines a 5 step process: 1) identify the acquirer and acquisition date, 2) measure consideration transferred, 3) recognize identifiable assets acquired and liabilities assumed, 4) recognize non-controlling interests, and 5) recognize resulting goodwill or gain on bargain purchase. Consideration includes assets given, liabilities incurred, and equity instruments issued, measured at fair value. Identifiable assets and liabilities are recognized and measured at fair value. Non-controlling interests may be measured at fair value or proportionate share of net assets. Goodwill is recognized as the excess of consideration over fair values. Adjustments may be made to reflect new information for up to one
The document discusses the key differences between existing AS 14 (Accounting for Amalgamations) and the revised Exposure Draft of AS 14 on business combinations. Some major differences include:
1. The revised standard applies the acquisition method, requiring identifiable assets acquired and liabilities assumed to be measured at fair value on the acquisition date.
2. It provides more guidance on accounting for contingent consideration, bargain purchases, step acquisitions, and transaction costs.
3. Additional disclosures are required to enable users to evaluate the nature and financial effects of business combinations.
Chap 5 IAS 40 - Investment Property.pptxKashif Butt
IAS 40 provides guidance on accounting for investment property. Investment property is property held to earn rentals or for capital appreciation. It can be measured using either the fair value model or cost model. The fair value model remeasures properties to fair value through profit or loss. The cost model measures properties similarly to property, plant, and equipment. Transfers between categories are accounted for depending on the models used. Extensive disclosures are required regarding investment properties.
Ias 16 property plant and equipment-presentationShadabAhmadFaiq
The document discusses the key aspects of IAS 16 Property, Plant and Equipment including:
- The objective is to prescribe the accounting treatment for property, plant and equipment.
- Scope outlines what is excluded like IFRS 5 and IAS 40.
- Definitions for terms like PPE, carrying amount, depreciation.
- Recognition criteria that future benefits are probable and cost can be reliably measured.
- Measurement includes initial cost and subsequent cost model or revaluation model.
- Depreciation is systematically allocated over useful life.
- Impairment is assessed using IAS 36.
- Derecognition occurs from disposal or no future benefits are expected.
Chap 6 - IAS 38 - Intangible Assets.pptxKashif Butt
IAS 38 establishes the accounting requirements for intangible assets. An intangible asset must be identifiable, controlled by the entity through custody or legal rights, and expected to generate future economic benefits. Intangible assets are initially measured at cost and can subsequently be measured either at cost or using the revaluation model. Research costs are expensed as incurred while development costs meeting certain criteria are recognized as intangible assets. Goodwill arising from a business combination is recognized as an asset at cost while internally generated goodwill is not recognized.
Chap 3 Fin Rep Prop Plant and Equip - IAS 16.pptKashif Butt
IAS 16 provides guidance on accounting for property, plant, and equipment. It requires that such assets be initially measured at cost and subsequently measured either using the cost model (cost less accumulated depreciation and impairment losses) or revaluation model. The standard specifies how to recognize, measure, depreciate, and disclose information related to an entity's property, plant, and equipment.
The document discusses the accounting standard for impairment of assets (IAS 36). It defines key terms like impairment loss, carrying amount, recoverable amount. The objective is to ensure assets are not carried at more than their recoverable amount. Assets are tested for impairment if internal or external factors indicate impairment. Recoverable amount is the higher of fair value less costs of disposal or value in use. An impairment loss is recognized in profit/loss for assets using cost model or by reducing revaluation surplus for assets using revaluation model.
IAS 40 provides guidance on accounting for investment property. Investment property is defined as property held to earn rentals or for capital appreciation. Investment property can initially be measured using either the cost model or fair value model. Under the cost model, investment property is carried at cost less accumulated depreciation and impairment losses. Under the fair value model, investment property is remeasured at fair value at each reporting date with changes in fair value recognized in profit or loss. The standard also provides guidance on recognition, measurement, transfers and disposal of investment property.
Vas ifrs conversion- financial instrumentTony Auditor
Under IFRS, four standards regulate financial instruments, but for 2012 only three applied - IAS 39, IAS 32, and IFRS 7. Under Vietnamese standards, only disclosure of financial instruments is regulated. The document analyzes how ABC's financial statements and accounting policies need to adjust to comply with IAS 39, which requires classification and subsequent measurement of financial assets and liabilities at fair value or amortized cost, testing for impairment, and other standards that were not followed under Vietnamese accounting. The adjustments aim to convert ABC's balance sheet and profit and loss statement to the recognition and measurement principles of IFRS.
The document discusses accounting standards for long-lived assets, including intangible assets. It notes that intangible assets are nonphysical assets that provide future economic benefits. The standard provides guidance on recognizing, measuring, and disclosing intangangible assets. It also discusses impairment testing of intangible assets to ensure they are carried at recoverable amounts. The standard applies to identifiable intangible assets and goodwill, but not to internally generated goodwill or brands.
Accounting standards with reference to Genting Lanco Power (India) Pvt.Ltd. kimi7792
The document discusses accounting standards in India issued by the Institute of Chartered Accountants of India (ICAI). It provides details on three key standards - AS 1 on disclosure of accounting policies, AS 2 on valuation of inventories, and AS 10 on accounting for fixed assets. For each standard, it outlines the objectives, relevant definitions, valuation methods, disclosure requirements, and other guidelines specified in the standards. It also includes an example balance sheet from Genting Lanco Power (India) Pvt. Ltd. as of March 31, 2014.
The document provides an overview of Accounting Standard 28 regarding impairment of assets. It outlines the applicability of the standard to different levels of enterprises based on their size. It describes the objective to identify impaired assets and ensure they are not carried at more than their recoverable amount. It also covers key aspects like computation of impairment loss, treatment, disclosures and transitional provisions.
The document provides an overview of Accounting Standard 28 regarding impairment of assets. It outlines the applicability of the standard to different levels of enterprises based on their size. It describes the objective to identify impaired assets and ensure they are not carried at more than their recoverable amount. It also covers key aspects like computation of impairment loss, treatment, disclosures and transitional provisions.
This document summarizes the key aspects of IAS 36 regarding impairment of assets. IAS 36 aims to ensure assets are not carried at more than their recoverable amount. It defines terms like carrying amount, cash-generating units and impairment loss. The standard outlines how to identify impaired assets, measure recoverable amount, recognize impairment losses, allocate losses to cash-generating units including goodwill, and reverse impairment losses. Entities must disclose impairment losses, reversals and reasons for changes in carrying amounts.
The document discusses the treatment of non-financial assets under IAS 16, 17, and 40. It provides an overview of key principles for property, plant, and equipment (PPE), investment property, and leases. For PPE, it covers recognition, measurement, depreciation, and derecognition. It also discusses asset retirement obligations. For investment property, it discusses definitions, initial and subsequent measurement, fair value model, and transfers between classes. For leases, it distinguishes between finance and operating leases and how they are classified and accounted for.
ISSUES ,GUIDELINES AND STANDARDS OF DEPRECIATION OF FIXED ASSETSZain Sahibzada
The document discusses guidelines for accounting for fixed assets according to IAS 16. It addresses issues such as recognition of assets at cost, measurement of cost, impairment losses, and depreciation. For depreciation, it describes methods like straight line, diminishing balance, and units of production. Guidelines state an asset is recognized at cost if future benefits are probable and cost reliable, and is measured at cost less depreciation and impairment over time.
Introduction : Investment in property and landMicha Paramitha
Investment in Property and Land discusses various types of investment property and land rights under Indonesian law. It defines investment property as property held to earn rentals or for capital appreciation rather than for use in production. The document outlines five types of land rights under Indonesian agrarian law: rights of ownership, rights of exploitation, rights to build, rights of use, and rights to operate. It also discusses factors that affect the selling price of property, including demand, supply, property restrictions/location/quality, and provides examples of relevant documents like IMB and PBB certificates.
Financial accounting mgt101 power point slides lecture 20Abdul Wadood Ansary
This document provides an overview of capital work in progress, revaluation of fixed assets, and accounting for the disposal of fixed assets when depreciation is charged on the basis of use. It discusses journal entries for capital work in progress, how to account for disposal of assets, and the rules and accounting treatment for revaluing fixed assets. The document also includes an example to illustrate calculating depreciation and the written down value of a disposed asset when depreciation is charged based on use of the asset.
The document provides a summary of key aspects of various Indian Accounting Standards (Ind AS). It discusses the objectives, requirements and differences compared to previous Indian GAAP/ IFRS of various Ind AS like Ind AS 1 on presentation of financial statements, Ind AS 2 on inventories, Ind AS 7 on statement of cash flows, Ind AS 8 on accounting policies etc. For each Ind AS, it highlights important principles, disclosure requirements, and carve outs or differences between Ind AS and corresponding IFRS.
Accounting standards notes Dr. V M TidakeVishal Tidake
The document discusses Indian Accounting Standards (AS) as issued by the Institute of Chartered Accountants of India (ICAI). It provides definitions and explanations of key terms like accounting standards, accounting policies, revenue recognition, accounting for fixed assets, and depreciation accounting. Some of the main points covered include that accounting standards aim to standardize accounting policies and practices, the Accounting Standards Board of ICAI prepares the standards, and there are currently 32 accounting standards in India. The document also provides details on the objectives, disclosure requirements, and treatment of certain items under some major accounting standards like AS 1 on accounting policies, AS 6 on depreciation, AS 9 on revenue recognition, and AS 10 on fixed assets.
PFRF for Coops webinar 2020 CDA Regional Office Ijo bitonio
e-Forum of CDA and PICPA Pangasinan Chapter
Aug 19, 2020
on CDA Issuances, Statutory Reserves, MC 2020-18, Journal Entries and Philippine Financial Reporting System
Similar to Ias36impairmentofassets 150604175400-lva1-app6891 (20)
The Future of Criminal Defense Lawyer in India.pdfveteranlegal
https://veteranlegal.in/defense-lawyer-in-india/ | Criminal defense Lawyer in India has always been a vital aspect of the country's legal system. As defenders of justice, criminal Defense Lawyer play a critical role in ensuring that individuals accused of crimes receive a fair trial and that their constitutional rights are protected. As India evolves socially, economically, and technologically, the role and future of criminal Defense Lawyer are also undergoing significant changes. This comprehensive blog explores the current landscape, challenges, technological advancements, and prospects for criminal Defense Lawyer in India.
Lifting the Corporate Veil. Power Point Presentationseri bangash
"Lifting the Corporate Veil" is a legal concept that refers to the judicial act of disregarding the separate legal personality of a corporation or limited liability company (LLC). Normally, a corporation is considered a legal entity separate from its shareholders or members, meaning that the personal assets of shareholders or members are protected from the liabilities of the corporation. However, there are certain situations where courts may decide to "pierce" or "lift" the corporate veil, holding shareholders or members personally liable for the debts or actions of the corporation.
Here are some common scenarios in which courts might lift the corporate veil:
Fraud or Illegality: If shareholders or members use the corporate structure to perpetrate fraud, evade legal obligations, or engage in illegal activities, courts may disregard the corporate entity and hold those individuals personally liable.
Undercapitalization: If a corporation is formed with insufficient capital to conduct its intended business and meet its foreseeable liabilities, and this lack of capitalization results in harm to creditors or other parties, courts may lift the corporate veil to hold shareholders or members liable.
Failure to Observe Corporate Formalities: Corporations and LLCs are required to observe certain formalities, such as holding regular meetings, maintaining separate financial records, and avoiding commingling of personal and corporate assets. If these formalities are not observed and the corporate structure is used as a mere façade, courts may disregard the corporate entity.
Alter Ego: If there is such a unity of interest and ownership between the corporation and its shareholders or members that the separate personalities of the corporation and the individuals no longer exist, courts may treat the corporation as the alter ego of its owners and hold them personally liable.
Group Enterprises: In some cases, where multiple corporations are closely related or form part of a single economic unit, courts may pierce the corporate veil to achieve equity, particularly if one corporation's actions harm creditors or other stakeholders and the corporate structure is being used to shield culpable parties from liability.
What are the common challenges faced by women lawyers working in the legal pr...lawyersonia
The legal profession, which has historically been male-dominated, has experienced a significant increase in the number of women entering the field over the past few decades. Despite this progress, women lawyers continue to encounter various challenges as they strive for top positions.
Receivership and liquidation Accounts
Being a Paper Presented at Business Recovery and Insolvency Practitioners Association of Nigeria (BRIPAN) on Friday, August 18, 2023.
Matthew Professional CV experienced Government LiaisonMattGardner52
As an experienced Government Liaison, I have demonstrated expertise in Corporate Governance. My skill set includes senior-level management in Contract Management, Legal Support, and Diplomatic Relations. I have also gained proficiency as a Corporate Liaison, utilizing my strong background in accounting, finance, and legal, with a Bachelor's degree (B.A.) from California State University. My Administrative Skills further strengthen my ability to contribute to the growth and success of any organization.
सुप्रीम कोर्ट ने यह भी माना था कि मजिस्ट्रेट का यह कर्तव्य है कि वह सुनिश्चित करे कि अधिकारी पीएमएलए के तहत निर्धारित प्रक्रिया के साथ-साथ संवैधानिक सुरक्षा उपायों का भी उचित रूप से पालन करें।
Genocide in International Criminal Law.pptxMasoudZamani13
Excited to share insights from my recent presentation on genocide! 💡 In light of ongoing debates, it's crucial to delve into the nuances of this grave crime.
Guide on the use of Artificial Intelligence-based tools by lawyers and law fi...Massimo Talia
This guide aims to provide information on how lawyers will be able to use the opportunities provided by AI tools and how such tools could help the business processes of small firms. Its objective is to provide lawyers with some background to understand what they can and cannot realistically expect from these products. This guide aims to give a reference point for small law practices in the EU
against which they can evaluate those classes of AI applications that are probably the most relevant for them.
This document briefly explains the June compliance calendar 2024 with income tax returns, PF, ESI, and important due dates, forms to be filled out, periods, and who should file them?.
Sangyun Lee, 'Why Korea's Merger Control Occasionally Fails: A Public Choice ...Sangyun Lee
Presentation slides for a session held on June 4, 2024, at Kyoto University. This presentation is based on the presenter’s recent paper, coauthored with Hwang Lee, Professor, Korea University, with the same title, published in the Journal of Business Administration & Law, Volume 34, No. 2 (April 2024). The paper, written in Korean, is available at <https://shorturl.at/GCWcI>.
2. The international accounting
standards (IAS)
The international accounting standards (IAS) were an older set of
standards stating how particular types of transactions and other events
should be reflected in financial statements. In the past,
international accounting standards were issued by the Board of the
International Accounting Standards Committee (IASC); since 2001, the new
set of standards has been known as the international financial reporting
standards (IFRS) and has been issued by the International Accounting
Standards Board (IASB).
In this presentation;
• IAS 36 Impairment of Assets 2004*
• IAS 40 Investment Property 2003*
4. Objective of IAS 36
• To ensure that assets are carried at no more
than their recoverable amount and to define
how recoverable amount is determined.
5.
6. • Impairment loss
Amount by which carrying amount of an asset or cash generating
unit exceeds its recoverable amount.
• Carrying amount
The amount at which as asset is recognized after deducting any
accumulated deprecation and accumulated impairment losses
thereon.
Book value OR value displayed in balance sheet.
7. Recoverable amount
The amount which is expected to be recovered by use or sale of the asset, whichever
is higher.
• The recoverable amount of an asset is the greater of the two calculations shown
below:
• Recoverable Amount = Fair Value - Cost ofDisposal
• Recoverable Amount = Value in Use
Fair value is the price that would be received to sell anasset.
Costs to sell would include legal costs to selling and direct incremental costs e.g. costs
which would necessarily be incurred if the asset issold
Value in use is the present value of the future cash flows expected to be derived from
an asset or cash-generating unit
8. • Example: CompanyA
• Building purchased = $ 2 million ; using straight line deprecation
• Estimated life = 20 years
• Used years by building = 5 years
• Selling cost of building = $ 1 million
• Cost incurred = $ 50,000 or $ 0.05 million
• PV of net cash flows the building = $ 1.2 million ( alternatively)
• The basic rule is to recognize impairment if carrying amount exceedsthe
recoverable amount.
• The building has a cost of $2 million, useful life of 20 years and is used for 5 years. The
accumulated depreciation is $2/20*5 or 0.5 million
• Carrying amount = building purchased – accumulated depreciation
• = 2 M – 0.5 M
• = $ 1.5 M
9. • Recoverable amount is the higher of fair value less costs to sell and value inuse.
• Fair value less costs to sell = $1 million - $0.05 million
= $0.95 million.
OR
• Value in use is the present value of future cash flows = $1.2 million.
• Carrying amount is $1.5 million while recoverable amount is $1.2 million.An
impairment loss of $0.3 million is to be recognized. The journal entry wouldbe:
Accumulated impairment
loss 300,000
10. • At the end of each reporting period, an entity is required to assess whether there
is any indication that an asset may be impaired (i.e. its carrying amount may be
higher than its recoverable amount). IAS 36 has a list of external and internal
indicators of impairment. If there is an indication that an asset may be impaired,
then the asset's recoverable amount must be calculated. [IAS 36.9]
• The recoverable amounts of the following types of intangible assets are measured
annually whether or not there is any indication that it may be impaired. In some
cases, the most recent detailed calculation of recoverable amount made in a
preceding period may be used in the impairment test for that asset in the current
period: [IAS 36.10]
I. an intangible asset with an indefinite useful life
II. an intangible asset not yet available for use
III. goodwill acquired in a business combination
Identifying an asset that may be impaired
11. Impairmen
t loss
Indicators of Impairments
Carrying
amount
Recoverable
amount
Impairment
loss
External
factors
Internal
factors
Impairment
loss
12. • External Factors • Internal Factors
• market value declines
• negative changes in technology,
markets, economy, or laws
• increases in market interest rates
• net assets of the company higher
than market capitalization
• obsolescence or physical
damage
• asset is idle, part of a
restructuring or held for
disposal
• for investments in subsidiaries,
joint ventures or associates, the
carrying amount is higher than
the carrying amount of the
investee's assets, or a dividend
exceeds the total comprehensive
income of the investee
13. Cash Generating Unit ( CGU)
Cash
Generating
Unit
Formedwith
group of
assets
Capable of generating
cashflows
independently of
other CGU’s
Recoverable amount should be determined for the individual asset, if
possible. [IAS 36.66]
If it is not possible to determine the recoverable amount for the individual
asset, then determine recoverable amount for the asset's cash-generating
unit (CGU). [IAS 36.66] The CGU is the smallest identifiable group of assets
that generates cash inflows that are largely independent of the cash
inflows from other assets or groups of assets.
15. IAS 40 Investment Property applies to the accounting for property (land
and/or buildings) held to earn rentals or for capital appreciation (or
both). Investment properties are initially measured at cost and, with
some exceptions. May be subsequently measured using a cost model or
fair value model, with changes in the fair value under the fair value
model being recognized in profit or loss.
Overview
17. Other classification issues
Property held under an operating lease.
A property interest that is held by a lessee under an operating lease may be
classified and accounted for as investment property provided that: [IAS 40.6]
the rest of the definition of investment property is met
the operating lease is accounted for as if it were a finance lease in accordance
with IAS 17 Leases
the lessee uses the fair value model set out in this Standard for the asset
recognised
An entity may make the foregoing classification on a property-by-property basis.
Partial own use.
If the owner uses part of the property for its own use, and part to earn rentals or
for capital appreciation, and the portions can be sold or leased out separately,
they are accounted for separately. Therefore the part that is rented out is
investment property. If the portions cannot be sold or leased out separately, the
property is investment property only if the owner-occupied portion is
insignificant. [IAS 40.10]
18. Ancillary services.
If the entity provides ancillary services to the occupants, the appropriateness
of classification as investment property is determined by the significance of
the services provided. If those services are a relatively insignificant component
of the arrangement as a whole, then the entity may treat the property as
investment property. Where the services provided are more significant, the
property should be classified as owner-occupied. [IAS 40.13]
Intracompany rentals.
Property rented to a parent, subsidiary, or fellow subsidiary is not investment
property in consolidated financial statements that include both the lessor and
the lessee, because the property is owner-occupied from the perspective of
the group. However, such property could qualify as investment property in the
separate financial statements of the lessor, if the definition of investment
property is otherwise met
19. Initial measurement
Investment property is initially measured at cost, including transaction costs.
Such cost should not include start-up costs, abnormal waste, or initial
operating losses incurred before the investment property achieves the
planned level of occupancy. [IAS 40.20 and 40.23]
Measure at
cost
including
transaction
costs
Purchase
price
Deferred
cash price
equivalent
(interest
expensed)
Costs when
construction
complete
Legal fees
Property
transfer
taxes
Direct
expenditure
20. Exclude from cost at recognition
Start
up costs
Operating losses
before planned
level of occupancy
Abnormal waste or
development expenditure
21. Measurement subsequent to
initial recognition
IAS 40 permits entities to choose between: [IAS 40.30]
a fair value model, and
a cost model.
One method must be adopted for all of an entity's investment property.
Change is permitted only if this results in a more appropriate presentation.
IAS 40 notes that this is highly unlikely for a change from a fair value model
to a cost model.
22. Measurement after recognition:
Accounting Policy
Choose and apply to all
investment property
Fair Value Model
Recognise gain or loss
in P&L of each period
Change from FV to cost
model not appropriate
Cost Model
Disclose FV
(professional valuation
recommended)
Rebuttable presumption
that FV can be
measured or residual
value must be zero
23. Fair Value Model
Measure all investment properties at fair value
Investment under operating lease may not be measured at costafter
initial recognition; it must be measured at fair value
Recognise gains and losses from changes in fair value in the profit
and loss account until disposal
Once held for sale, measure investment property according to IFRS
5
Fair value must reflect market conditions at the balance sheet date
Current prices in active market for similar property in same location and
condition under similar lease or other contract
Current/recent prices adjusted to reflect differences
If reasonable estimate of fair value not available for a particular
property, use IAS 16 cost model in exceptional cases
Residual value must be zero
Apply IAS 16 cost model until disposal
24. Fair Value
Price between
knowledgeable
willing parties
in arms length
transaction
Exclude
special
financing
terms
Include
disposal costs
Reflect market
conditions at
balance sheet
date
Include rental
income and
similar
outflows
25. Cost model
After initial recognition, investment property is accounted for in
accordance with the cost model as set out in IAS 16 Property, Plant
and Equipment – cost less accumulated depreciation and less
accumulated impairment losses.
26. Transfers to, or from, investment property should only be made when
there is a change in use, evidenced by one or more of the following:
Transfers to or from investment property classification
owner-occupation
(fair value at date
of change in use)
development for
sale
End of
owner
occupation
commencement of
an operating lease
to another party
27. Disposal
An investment property should be derecognised on disposal or when
the investment property is permanently withdrawn from use and no
future economic benefits are expected from its disposal. The gain or
loss on disposal should be calculated as the difference between the net
disposal proceeds and the carrying amount of the asset and should be
recognised as income or expense in the income statement. [IAS 40.66
and 40.69] Compensation from third parties is recognised when it
becomes receivable. [IAS 40.72]
28. Disclosure: Fair Value Model & Cost Model
• Whether fair value or cost model applied
• Reasons for classifying property under operating leaseas
investment property
Model
• Criteria to distinguish owner-occupied from investment
property
• Methods and assumptions to calculate fair value
• Market evidence to support fair value
• Whether or not a professional valuation was obtained
Value
• Restrictions on realisability (existence and amounts)
• Contractual obligations to develop, repair, maintain or
enhance investment property
Obligations
29. Disclosure: Fair Value Model and Cost
Model
• Rental income
• Direct operating expenses relating to rental income
• Direct operating expenses not related to rental income
• Cumulative change in fair value from sale of asset at cost
to fair value pools
Amounts in
profit or loss
• Reconciliation between carrying amounts at beginning and
end of period
• Reconciliation between valuation obtained and valuation
included in financial statements (if adjusted)
Fair value
model
• Description of investment property
• Reason why fair value cannot be determined
• Range of estimates in which fair value is likely to fall
• Disposal of investment property not carried at fair value
(carrying amount and recognised gain or loss)
Cost model
30. Cost model: Additional disclosure
Depreciation methods used
Useful lives
Gross carrying amount
Accumulated depreciation and impairment loss at beginning and end of period
Reconciliation of carrying amount at beginning and end of period
Additions
From subsequent expenditure
From acquisitions
Assets classified as held for sale
Depreciation
Impairment loss recognised and reversed
Net exchange differences on translation
Transfers to and from inventories and owner-occupied property
Fair value of investment property or
Description of property
Reason why fair value cannot be determined
Range of estimates in which fair value is likely tolie
31. Fair value model: Additional disclosure
Reconciliation between carrying amount at beginning
and end of period
Additions
From acquisition
From subsequent expenditure
From acquisitions through business combinations
Assets classified as held for sale
Net gain or loss from fair value adjustments
Net exchange difference on translation
Transfer to and from inventories and owner-occupied
property
Other changes