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8 Cards in this Set
- Front
- Back
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Leases |
Criteria to determine operating or capital: - >75% of useful life of asset - NPV of payments >90% of current FMV - substantially all risks and rewards transferred to lessee |
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Revenue recognition (A) |
IAS 18/ASPE 3400
Measurement: at fair value of consideration received/receivable
Multiple deliverables: can be measured by two approaches - relative fair value (proceeds allocated based on relative fair value of components) - residual value (used when fair value of one component cannot be determined)
IAS 18 - Sale of goods: 1. Risks/rewards transferred 2. Seller retains no ongoing involvement/control 3. Revenue measured reliably 4. Probable that evict benefits will flow to seller 5. Seller's costs measured reliable *Can include standard warranty provisions
IAS 18 - Rendering of services: 1. Revenue measured reliably 2. Probable that economic benefits will flow to seller 3. Stage of completion at end of period can be measured reliably 4. Seller's costs measured reliably
ASPE 3400 - Sale of goods: 1. Risks/rewards have transfer with no continued managerial control 2. Revenue measured reliably 3. Collection reasonably assured |
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MD&A (B) |
Objectives: 1. Enables readers to view company's performance, financial condition and future prospects from management's protective 2. Supplement/complement financial statements 3. Completeness/materiality 4. Outline trends/risks that could effect current/future statements 5. Management's strategy to generate value 6. Understandable, relevant, comparable Elements of disclosure framework: 1. Core businesses/strategy 2. Key performance drivers 3. Capability to deliver results 4. Results/outlook 5. Risks |
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Contingencies |
IAS 37/ASPE 3290
Transactions that rely on other events occurring in order to exist
Recognition of provision: - probable (defined in IFRS/ASPE) that entity will have outflow of economic resources - outflow can be measured reliably
Recognition of contingent liability: - when criteria for provision not met - do not record but disclose in notes if outflow possible (or probable but not measurable)
Contingent inflows: - only record if virtually certain (95-100%) - disclose if probable (50-94%)
IFRS: - probable = >50% - possible = 11-50% - remote = 0-10% * Record weighted average of possible outcomes
ASPE: - likely = >70% (record provision) - possible = 11-70% (disclose) - unlikely = 0-10% (nothing) * Record minimum outcome and disclose other possible outcomes |
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Decommissioning provision (IFRS)/asset retirement obligation(ASPE) |
IAS 37 Criteria: - entity has present obligation as a result of past event (legally required or based on pattern of behaviour) - probable outflow of resources to settle obligation - reliable estimate of obligation (updated each period for liabilities with interest expense and assets depreciated)
ASPE 3110 - must be legal obligation only - use accretion expense instead of interest expense |
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Employee benefits |
Defined contribution plans: - post-employment benefit plans under which entity pays fixed contributions into separate entity/fund - employer not responsible for how much will be paid out in the end (risk borne by employee) -e.g. pension plan
Defined benefit plans: - future benefits to be paid out to employees are defined by terms of plan (as amount or formula to determine amount) - risk borne by employer - income statement (pension/interest expense) - balance sheet (defined benefit asset/liability)
***See Oracle document*** |
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Assets held for sale and discontinued operations |
Held for sale
Conditions: - asset is available for sale in present condition - usual/customary terms of sale - sale is highly probable (management committed to sale, actively seeking buyer, asset marketed at reasonable price, sale within one year or extenuating circumstances, unlikely plan to sell will change)
Measurement: - lower of carrying value and fair value minus selling costs - no depreciation once HFS - separate classification from other assets on BS
Discontinued operations - component of entity that has been disposed of or classified as HFS and meets criteria
Classification (meets 1 of following): - represents separate major line of business or geographical area - part of single coordinated plan to dispose of separate line of business - subsidiary acquired with intention of resale
Measurement: - same as HFS
*Presented on income statement with total profit/loss from discontinued operations and gain/loss on remeasurement or disposal |
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Changes in accounting |
Change in estimate - result of new information not previously available when statements compiled - result of new information not previously available when statements compiled - when actual outcome of event is materially different than estimate, change applied prospectively (no change to past transaction)
Change in policy (ASPE 1506)
Conditions: - effect of change provides more relevant/reliable statements - standard or it's interpretation requires change
Policies applied retrospectively or using transition plan for new policies
Per IAS 1 at least 3 years of BS and 2 years of other statements must be amended
Correction of errors (IAS 8) - different from change in estimate - applied retrospectively to period where error occurred |
