IFRS Question #1
IFRS Questions
Review the Preface. Include the applicable paragraph citation with your response. .
USA IFRS; What is the jurisdiction status of adoption? – When a foreign company is trading on a US stock market they can and are allowed to use current IFRS standards and not US GAAP standards
1) When was the International Accounting Standards Board (IASB) established?
2001
Review the standards and interpretations. For each of your responses, identify the applicable paragraph.
2) Review IFRS 3. How does a company determine the amount of goodwill to recognize?
IFRS 3, Par 32
Proceeds – net identifiable assets = goodwill
*Major principles are in bold within the standards*
3) Review IFRS 5. How does the standard define discontinued operations?
IFRS 5, Par 31
A component of an entity comprises operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the entity. In other words, a component of an entity will have been a cash-generating unit or a group of cash-generating units while being held for use. IFRS 5, Par 32
A discontinued operation is a component of an entity that either has been disposed of, or is classified as held for sale, and
(a) represents a separate major line of business or geographical area of operations, (b) is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations or
(c) is a subsidiary acquired exclusively with a view to resale
4) Review IFRS 9. In developing the standard, what other accounting standards board did the IASB work with?
IFRS 9, IN3 US national standard-setter
IFRS 9, IN4 Financial Stability Board
5) Review IAS 1. When should a company classify assets as current? Liabilities?
IAS 1, Par 66 Assets
An entity shall classify an asset as current when:
(a) it expects to realise the asset, or intends to sell or consume it, in its normal operating cycle;
(b) it
Review the Preface. Include the applicable paragraph citation with your response. .
USA IFRS; What is the jurisdiction status of adoption? – When a foreign company is trading on a US stock market they can and are allowed to use current IFRS standards and not US GAAP standards
1) When was the International Accounting Standards Board (IASB) established?
2001
Review the standards and interpretations. For each of your responses, identify the applicable paragraph.
2) Review IFRS 3. How does a company determine the amount of goodwill to recognize?
IFRS 3, Par 32
Proceeds – net identifiable assets = goodwill
*Major principles are in bold within the standards*
3) Review IFRS 5. How does the standard define discontinued operations?
IFRS 5, Par 31
A component of an entity comprises operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the entity. In other words, a component of an entity will have been a cash-generating unit or a group of cash-generating units while being held for use. IFRS 5, Par 32
A discontinued operation is a component of an entity that either has been disposed of, or is classified as held for sale, and
(a) represents a separate major line of business or geographical area of operations, (b) is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations or
(c) is a subsidiary acquired exclusively with a view to resale
4) Review IFRS 9. In developing the standard, what other accounting standards board did the IASB work with?
IFRS 9, IN3 US national standard-setter
IFRS 9, IN4 Financial Stability Board
5) Review IAS 1. When should a company classify assets as current? Liabilities?
IAS 1, Par 66 Assets
An entity shall classify an asset as current when:
(a) it expects to realise the asset, or intends to sell or consume it, in its normal operating cycle;
(b) it