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Presentation of a group of entities as a single economical entity

9.13 The consolidated financial statements present financial information about the group as a single economic entity. In preparing consolidated financial statements, an entity shall:

  1. combine the financial statements of the parent and its subsidiaries line by line by adding together like items of assets, liabilities, equity, income and expenses.
  2. eliminate the carrying amount of the parent’s investment in each subsidiary and the parent’s portion of equity of each subsidiary.
  3. measure and present non-controlling interest in the profit or loss of consolidated subsidiaries for the reporting period separately from the interest of the owners of the parent.
  4. measure and present non-controlling interest in the net assets of consolidated subsidiaries separately from the parent shareholders’ equity in them. Non-controlling interest in the net assets consists of:
    1. the amount of the non-controlling interest at the date of the original combination calculated in accordance with Business Combinations and Goodwill; and
    2. the non-controlling interest’s share of changes in equity since the date of the combination.

...continue reading "Consolidation procedures"

Consolidated and Separate Financial Statements – Introduction

Here are the circumstances defined in which an entity applying IFRS in summary presents consolidated financial statements and what the procedures are for preparing those statements in accordance with IFRS in summary.

Consolidated and Separate Financial Statements includes guidance

...continue reading "Consolidated and Separate Financial Statements"

See Inventories for the IFRS in summary, the complete IAS 2 Inventories discussion is outstanding.

Inventory is also called stock in trade, or just stock.

The IFRS definition of inventory is brief, let's add some juice (if that is possible in accounting, and off course it is possible!!) or look at it as being in business. ...continue reading "Inventories – the highlights"

Inventories introduction

The principles for recognising and measuring inventories are included in here. Inventories are assets:

  1. held for sale in the ordinary course of business;
  2. in the process of production for such sale; or
  3. in the form of materials or supplies to be consumed in the production process or in the rendering of services.

...continue reading "Inventories"


An entity applying this section shall make all of the disclosures required in Basic financial instruments incorporating in those disclosures financial instruments that are within the scope of this section as well as those within the scope of Basic financial instruments. In addition, if the entity uses hedge accounting, it shall make the additional disclosures in Obligated disclosures (see below), Hedge of fixed interest rate risk or commodity price risk or Firm commitment or highly probable forecast transaction. ...continue reading "Other Financial Instrument Issues – 3"

Impairment of financial assets measured at cost or amortised cost

Guidance on impairment

An entity shall apply the guidance on impairment in the section Impairment of financial assets measured at cost or amortised cost to financial assets measured at cost less impairment in accordance with this section.

Derecognition of a financial asset or financial liability

...continue reading "Other Financial Instrument Issues – 2"

Introduction to Other Financial Instrument Issues

A financial instrument is a contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

Financial Instruments in Other Financial Instrument Issues are more complex transactions measured at fair value, with changes in fair value in profit or loss with some hedges included in other comprehensive income by the section  Conditions are met  and some equity instruments at cost less impairment as per Reliable measure of fair value no longer available. ...continue reading "Other Financial Instrument Issues – 1"


Disclosures for financial liabilities measured at fair value through profit or loss

The following disclosures make reference to disclosures for financial liabilities measured at fair value through profit or loss. Entities that have only basic financial instruments (and therefore do not apply Other Financial Instrument Issues ) will not have any financial liabilities measured at fair value through profit or loss and hence will not need to provide such disclosures.

Disclosure of accounting policies for financial instruments

...continue reading "Basic Financial Instruments 5"

Derecognition of a financial asset

Only derecognition of a financial assets when either

An entity shall derecognise a financial asset only when either:

  1. the contractual rights to the cash flows from the financial asset expire or are settled;
  2. the entity transfers to another party substantially all of the risks and rewards of ownership of the financial asset; or
  3. the entity, despite having retained some significant risks and rewards of ownership, has transferred control of the asset to another party and the other party has the practical ability to sell the asset in its entirety to an unrelated third party and is able to exercise that ability unilaterally and without needing to impose additional restrictions on the transfer—in this case, the entity shall:
    1. derecognise the asset; and
    2. recognise separately any rights and obligations retained or created in the transfer.

...continue reading "Basic Financial Instruments 4"

Impairment of financial assets measured at cost or amortised cost

Recognition impairment – Objective evidence of impairment

At the end of each reporting period, an entity shall assess whether there is objective evidence of impairment of any financial assets that are measured at cost or amortised cost. If there is objective evidence of impairment, the entity shall recognise an impairment loss in profit or loss immediately. ...continue reading "Basic Financial Instruments 3"