Compiled and Presented By……

IFRS at a Salahuddin K. Shameem ACA

Senior Manager and Head of QAD
Glance Hussain Farhad & Co.
Chartered Accountants

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 The objective of IFRS is:
• To establish a universal language for the companies to
prepare the financial statements.
• To establish accounting rules to make it easier for the
Objective of stakeholders to interpret the financial statements
irrespective of the business location.
IFRS • Make the accounting statements comparable, credible and
transparent.
• To assist companies in appropriately categorizing and
reporting financial data.
• To make comparisons and to perform data analysis easy and
meaningful.

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 Relationship between IFRS and IAS:
IAS represents International Accounting Standards, while IFRS refers to International
Financial Reporting Standards. The IAS were published between 1973 and 2001, while
IFRS were published from 2001 onwards. IAS measures come via the International
Accounting Standard Committee (IASC), while the IFRS come through the International
Relationship Accounting Standard Board (IASB), which succeeded the IASC. In 2001, when the IASB
took over IASC’s responsibility in setting the standards, it was agreed to adopt all IAS
between IFRS and name future standards as IFRS and any principles within IFRS that may be
contradictory, will supersede IAS.
and IAS Technically, they are the same but gradually, new IFRS will replace old IAS e.g., IFRS 16
Leases replaces IAS 17 Lease.

When BFRS was replaced by IFRS?:

The Council of the Institute of Chartered Accountants of Bangladesh (ICAB) has decided
to move towards International Financial Reporting Standards (IFRS) in Bangladesh
instead of its current format of Bangladesh Financial Reporting Standards (BFRS) from 1
January 2018. So, for all applicable entities in Bangladesh, IFRS will be effective for
annual period beginning on or after 1 January 2018.
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 IFRS 2- Share-based Payment
Objective Scope Recognition Subsequent Measurement Disclosure Requirements

IFRS 2 sets out the The concept of share- An entity shall recognize the goods or For equity-settled share-based • The nature and extent of
accounting for based payments is services received or acquired in a payment transactions, the entity share-based payment
transactions in which broader than share-based payment transaction shall measure the goods or services arrangements that
an entity receives or employee share when it obtains the goods or as the received, and the corresponding existed during the period.
acquires goods or options. services are received. The entity shall increase in equity, directly, at the • How the fair value of the
services either as recognize a corresponding increase in fair value of the goods or services goods or services
consideration for its IFRS 2 applies to all equity if the goods or services were received, unless that fair value received, or the fair value
equity instruments or entities. There is no received in an equity-settled share- cannot be estimated reliably. If the of the equity instruments
by incurring liabilities exemption for private based payment transaction, or a entity cannot estimate reliably the granted during the period
for amounts based on or smaller entities. liability if the goods or services were fair value of the goods or services was determined.
the price of its shares acquired in a cash-settled share-based received, the entity shall measure • The effect of share-based
or other equity Furthermore, payment transaction. their value, and the corresponding payment transactions on
instruments. subsidiaries using their increase in equity. the entity's profit or loss
parent's or fellow Associated expense should be spread for the period and on its
subsidiary's equity as over the vesting period (unless vest For cash-settled share-based financial position.
consideration for immediately). payment transactions, the entity
goods or services are shall measure the goods or services
within the scope of the Expense should take into account non- acquired and the liability incurred at
Standard. market-based vesting conditions. the fair value of the liability.

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 IFRS 3- Business Combinations
Objective Scope Initial Measurement Subsequent Disclosure Requirements
Measurement

IFRS 3 outlines the This IFRS applies to a As of the acquisition date, the In general, an acquirer shall The acquirer shall disclose
accounting when an transaction or other event acquirer shall recognize, subsequently measure and information that enables
acquirer obtains control of that meets the definition of separately from goodwill, the account for assets acquired, users of its financial
a business (e.g., an a business combination. identifiable assets acquired, the liabilities assumed or statements to evaluate the
acquisition or merger). liabilities assumed and any incurred, and equity nature and financial effect of
Such business non- controlling interest in the instruments issued in a a business combination that
combinations are acquiree. business combination in occurs either:
accounted for using the accordance with other (a) during the current
'acquisition method', which The acquirer shall measure the applicable IFRS for those reporting period; or
generally requires assets identifiable assets acquired and items, depending on their (b) after the end of the
acquired and liabilities the liabilities assumed at their nature. reporting period but before
assumed to be measured at acquisition- date fair values the financial statements are
their fair values at the authorized for issue.
acquisition date.

**IFRS 4 is not commonly used, so, IFRS 5 will be presented in the next slide. 5
 IFRS 5- Non-current Assets Held for Sale and
Discontinued Operations
Objective Scope Initial Measurement Subsequent Disclosure Requirements
Measurement
IFRS 5 outlines how to account for A disposal group may include At the time of An entity shall measure a Non-current assets and
non-current assets held for sale current and non-current assets classification as held for non- current asset (or disposal disposal groups classified as
(or for distribution to owners). and current and non-current sale immediately before group) classified as held for held for sale should be
IFRS 5 requires assets and groups liabilities. the initial classification of sale at the lower of its presented separately from
of assets that are ‘held for sale’ to IFRS 5 does not apply to: the asset as held for sale, carrying amount and fair value other assets in the
be presented separately on the • Deferred tax assets (IAS the carrying amount of less costs to sell. statement of financial
face of the statement of financial 12). the asset will be measured position.
position and the results of • Assets arising from in accordance with Non-current assets held for
discontinued operations to be employee benefits (IAS 19). applicable IFRSs. Resulting sale should not be Additional Disclosures:
presented separately in the • Financial assets (IFRS 9). adjustments are also depreciated, even if they are • A description of the non-
statement of profit or loss and • Investment properties recognized in accordance still being used by the entity. current asset (or
other comprehensive income. accounted for in with applicable IFRSs. disposal group).
accordance with the fair • A description of the facts
This is required so that users of value model (IAS 40). and circumstances of the
financial statements will be better • Agricultural and biological disposal.
able to make projections about assets that are measured • Any gain or loss
the financial position, profits and at fair value less estimated recognized when the
cash flows of the entity based on point of sale costs (IAS 41). item was classified as
continuing operations only held for sale.

**IFRS 6 is not commonly used, so IFRS 7 will be presented in the next slide. 6
 IFRS 7- Financial Instruments: Disclosures
Objective Scope Disclosures In SFP Disclosures in SoPL
IFRS 7 requires disclosure IFRS 7 applies to all entities and to all The following disclosures are required in the An entity should disclose the following
of information about the types of financial instruments, except statement of financial position (SFP): items of income, expense, gains or losses
significance of financial instruments that are specifically covered • Categories of financial assets (FA) and either in the statement of profit or loss
instruments to an entity, by other standards as follows: financial liabilities: (SoPL) and other comprehensive income
and the nature and • Interests in subsidiaries, associates • The carrying amounts of FA at Fair or in the notes:
extent of risks arising and joint ventures that are accounted Value Through Profit or Loss • Net gains or net losses classified on
from those financial for in accordance with IFRS 10- (FVTPL), Fair Value Through Other financial assets or liabilities through
instruments, both in Consolidated Financial Statements or Comprehensive Income ( FVTOCI), PL, investment in equity instrument,
qualitative and IAS 28- Investments in Associates and amortized cost, investment in held- to-maturity investment, loans
quantitative terms. Joint Ventures. equity instruments, financial and receivables and financial
Specific disclosures are • Employers’ rights and obligations liabilities (FL) at FVTPL and liabilities measured at amortized
required in relation to arising from employee benefit plans, amortized cost, as defined in IFRS cost.
transferred financial to which IAS 19- Employee Benefits 9. • Total interest income and total
assets and a number of applies. • Loans and receivables at FVTPL including interest expense.
other matters. • Insurance contracts as defined in IFRS calculation of credit risk, methods of • Fee income and expense.
17- Insurance Contracts. calculation and market risk. • Interest income on impaired financial
• Financial instruments, contracts and • Other disclosures such as accounting assets.
obligations under share-based policies, hedge accounting and fair value • The amount of any impairment loss
payment transactions to which IFRS 2- as per IFRS 13. for each class of financial asset.
Share-based Payment applies.

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 IFRS 8- Operating Segments
Objective Scope Determining reportable Disclosures Requirements
segments

IFRS 8 requires entities to This standard applies only to An operating segment is reportable • Segment disclosures: factors used to identify the
disclose information to entities with debt or equity where: entity’s reportable segments.
enable users of its financial instruments traded in a • It meets the definition of an • Types of products and services from each of the
statements to evaluate the public market or is in the operating segment; and reportable segments including operating segment
nature and financial effects process of issuing • Any of the following size criteria revenue, interest revenue, profit or loss, income
of the business activities in instruments in a public are met: taxes, segment assets & liabilities, and certain
which it engages and the market. • Segment revenue ≥ 10% of income and expense items, non-current assets,
economic environments in total revenue investment in associates/jointly controlled entities,
which it operates. • Segment profit or loss ≥ and reportable segment liabilities.
10% of the profit of all • Entity-wise disclosures of external revenue by each
segments in profit. product and service along with geographical
• Segment assets ≥ 10% of information.
total assets
• At least 75% of total external
revenue must be reported by
operating segments.

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 IFRS 9- Financial Instruments
Objective Scope Initial Measurement Subsequent Measurement
The objective of this standard is This Standard shall be applied by all entities to Financial assets: Financial assets:
to establish principles for the all types of financial instruments except: • Investments in debt instruments: • Investments in debt
financial reporting of financial • those interests in subsidiaries, associates Fair value + transaction costs instruments: Amortized cost.
assets and financial liabilities that and joint ventures that are accounted for • Investments in equity instruments • Investments in equity
will present relevant and useful in accordance with IFRS 10, IAS 27, IAS 28, not ‘held for trading’: Fair value + instruments not ‘held for
information to users of financial IAS 32. transaction costs trading’: Fair value through
statements for their assessment • rights and obligations under leases to • All other financial assets: Fair value other comprehensive income.
of the amounts, timing and which IFRS 16 Leases applies. (transaction costs expensed in P/L) • All other financial assets: Fair
uncertainty of an entity’s future • employers’ rights and obligations under value through profit or loss
cash flows. employee benefit plans, to which IAS 19 Financial liabilities:
applies. • Most financial liabilities (e.g., trade Financial liabilities:
IFRS 9 sets out requirements for • financial instruments issued by the entity payables, loans, preference shares • Most financial liabilities (e.g.,
recognition and measurement of that meet the definition of an equity classified as a liability): Fair value trade payables, loans,
financial instruments, including instrument in IAS 32. less transaction costs preference shares classified as
impairment, derecognition and • financial instruments, contracts and • Financial liabilities at fair value a liability): Amortized cost
general hedge accounting. obligations under share-based payment through profit or loss: Fair value • Financial liabilities at fair value
transactions to which IFRS 2 applies. (transaction costs expensed in P/L) through profit or loss: Fair
• rights and obligations and impairment value through profit or loss
requirement within the scope of IFRS 15.

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 IFRS 10- Consolidated Financial Statements
Objective Control Definition Consolidation Procedures

IFRS 10 sets out the requirements for IFRS 10 states that an investor controls an A parent prepares consolidated financial statements using
determining whether an entity (a parent) investee if and only if it has all of the following: uniform accounting policies for like transactions and other
controls another entity (a subsidiary). The • Power over the investee is the ability to events in similar circumstances.
most important aspect is control. direct activities that influence returns Procedure of Preparing Consolidated Financial Statements:
• The ability to use its power over the • Combine like items of assets, liabilities, equity, income,
IFRS 10 covers the basic definitions and investee to affect the amount of the expenses and cash flows of the parent with those of its
consolidation requirements and the rules on investor’s returns. subsidiaries.
exemptions from preparing group accounts. • Exposure, or rights, to variable returns from • Offset (eliminate) the carrying amount of the parent's
its involvement with the investee investment in each subsidiary and the parent's portion of
The standard requires a parent to present • If there are changes to one or more of equity of each subsidiary (IFRS 3 Business Combinations
consolidated financial statements, these three elements of control, then an explains how to account for any related goodwill).
consolidating all subsidiaries, both foreign investor should reassess whether it • Eliminate in full intra-group assets and liabilities, equity,
and domestic. controls an investee. income, expenses and cash flows relating to transactions
between entities of the group (profits or losses resulting
from intragroup transactions that are recognized in assets,
such as inventory and fixed assets, are eliminated in full).

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 IFRS 11- Joint Arrangements
Objective Scope Recognition-Joint Operation Recognition-Joint Venture

IFRS 11 outlines the accounting by IFRS 11 applies to all • Each party to the joint operation (or each • Each party to the joint venture recognizes
entities that jointly control an entities that are a “joint operator”) recognizes an investment.
arrangement. Joint control involves party to a joint its share of the assets, liabilities, revenues • The investment is accounted for using the
the contractually agreed sharing of arrangement (joint and expenses of the joint equity method in accordance with IAS 28 .
control and arrangements subject to operation or joint arrangement. • The general requirements of IAS 28
joint control that is classified as either venture). • The share is determined based on the remain essentially unchanged from the
a joint venture (representing a share rights and obligations of each party as set existing guidance on equity-method
of net assets and equity accounted) out in the contractual terms. accounting.
or a joint operation (representing • The joint operator is required to apply the
rights to assets and obligations for corresponding IFRS to each
liabilities, accounted for accordingly). financial statement element recognized.

**IFRS 12 is not commonly used, so IFRS 13 will be presented in the next slide. 11
 IFRS 13- Fair Value Measurement
Objective Scope Fair Value Hierarchy Valuation Techniques
IFRS 13, Fair Value IFRS 13 applies when another The standard establishes a three-level hierarchy for An entity uses valuation techniques
Measurement gives standard requires or permits fair the inputs that valuation techniques use to measure appropriate in the circumstances and for
extensive guidance on how value measurements or fair value: which sufficient data are available to
the fair value of assets and disclosures about fair value • Level 1: Quoted prices (unadjusted) in active measure fair value, maximizing the use of
liabilities should be measurements (and markets for identical assets or liabilities that the relevant observable inputs and minimizing
established. measurements such as fair value reporting entity can access at the measurement the use of unobservable inputs.
less costs to sell) but does not date.
It sets out to: stipulate which items should be • Level 2: Inputs other than quoted prices Three widely used valuation techniques
• define fair value. measured or disclosed at fair included within Level 1 that are observable for that are used to determine the fair value,
• set out in a single IFRS a value. the asset or liability, either directly or indirectly are:
framework for measuring e.g., quoted prices for similar assets in active • market approach
fair value. markets or for identical or similar assets in non- • cost approach
• require disclosures about active markets or use of quoted interest rates • income approach
fair value measurements. for valuation purposes.
• Level 3: Unobservable inputs for the asset or
liability i.e., using the entity’s own assumptions
about market exit value

**IFRS 14 is not commonly used, so IFRS 15 will be presented in the next slide. 12
 IFRS 15- Revenue from Contracts with Customers
Objective Scope Recognition Presentation Disclosure Requirements

IFRS 15 specifies how IFRS 15 applies to all Revenue is recognized in accordance Contracts with customers will • Category-wise revenue
and when an entity will contracts with customers with this core principle by applying a be presented in an entity’s from contracts with
recognize revenue as except for: five-step model: statement of financial position customers.
well as requiring such • leases within the • Step 1: Identify the contract(s) as: • Impairment losses
entities to provide scope of IFRS 16- with a customer. • a contract liability, recognized on receivables,
users of financial Leases. • Step 2: Identify separate • a contract asset, or or contract assets.
statements with more • insurance contracts performance obligations. • a receivable depending on • The opening and closing
informative and within the scope of • Step 3: Determine the transaction the relationship between balances of receivables,
relevant disclosures. IFRS 4- Insurance price. the entity’s performance contract assets and contract
Contracts. • Step 4: Allocate transaction price and the customer’s liabilities.
The standard provides • non-monetary to performance obligations. payment. • A description of
a single, principles exchanges between • Step 5: Recognize revenue as or performance obligations.
based five-step model entities in the same when each performance Where revenue has been • The transaction price
to be applied to all line of business. obligation is satisfied. invoiced, a receivable is allocated to performance
contracts with recognized. Where revenue has obligations that are
customers. Revenue is therefore recognized been earned but not invoiced, it unsatisfied at the end of the
when control over goods or services is is recognized as a contract reporting period and the
transferred to the customer. asset. explanations.

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 IFRS 16- Leases
Objective Scope Recognition Initial Measurement Subsequent
measurement
IFRS 16 sets out the An entity shall apply this Standard to all At the commencement Initially, the right-of-use Subsequently, the right-
recognition, measurement, leases, including leases of right-of-use assets date, a lessee shall asset is measured at of-use asset will be
presentation and disclosure in a sublease, except for: recognize a right-of-use cost (initial lease liability measured at cost less
requirements for leases. (a) leases to explore for or use minerals, oil, asset and a lease liability. + initial direct cost+ any accumulated depreciation
natural gas and similar non-regenerative lease payment initially + and impairment losses in
The standard provides a resources; Lessors shall classify each dismantling cost) line with IAS 16, Property,
single lessee accounting (b) leases of biological assets within the lease as an operating lease Plant and Equipment.
model, requiring lessees to scope of IAS 41- Agriculture held by a or a finance lease.
recognize assets and lessee; Subsequently, the lease
liabilities for all leases unless (c) service concession arrangements within A lease is classified as a At commencement of liability is amortized:
the lease term is 12 months the scope of IFRIC 12- Service Concession finance lease if it transfers the lease, the lease • Interest will accrue on
or less or the underlying Arrangements; substantially all the risks liability is measured at the outstanding lease, at
asset has a low value. (d) licenses of intellectual property granted and rewards incidental to the present value of the rate stated in the lease
by a lessor within the scope of IFRS 15- ownership of an underlying future lease payments contract.
Lessors continue to classify
Revenue from Contracts with Customers; asset. Otherwise, a lease is including any payments • Payments made in
leases as operating or
(e) rights held by a lessee under licensing classified as an operating expected at the end of respect of the lease by the
finance, with IFRS 16
agreements within the scope of IAS 38- lease. the lease. lessee will reduce the
approach to lessor
Intangible Assets for such items as outstanding liability.
accounting substantially
motion picture films, video recordings,
unchanged from IAS 17.
plays, manuscripts, patents and
copyrights
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 IFRS 17- Insurance Contracts
Objective Scope Initial Measurement Subsequent Disclosure Requirements
Measurement
IFRS 17 establishes the principles for An entity shall apply On initial recognition, an On subsequent measurement, An entity shall disclose
the recognition, measurement, IFRS 17 to: entity shall measure a group the carrying amount of a qualitative and quantitative
presentation and disclosure of (a) insurance of insurance contracts at the group of insurance contracts information about:
insurance contracts within the scope of contracts, including total of: at the end of each reporting
the standard. reinsurance contracts, (a) the fulfilment cash flows period shall be the sum of: (a) the amounts recognized
it issues; (“FCF”), which comprise: (a) the liability for remaining in its financial
The objective of IFRS 17 is to ensure (b) reinsurance (i) estimates of future cash coverage comprising: statements that arise
that an entity provides relevant contracts it holds; and flows; (i) the FCF related to future from insurance
information that faithfully represents (c) investment (ii) an adjustment to reflect services and; contracts;
those contracts. This information gives contracts with the time value of money (ii) the CSM of the group at (b) the significant
a basis for users of financial statements discretionary (“TVM”) and the that date; judgements, and
to assess the effect that insurance participation features financial risks associated (b) the liability for incurred changes in those
contracts have on the entity's financial it issues, provided the with the future cash claims, comprising the FCF judgements, made when
position, financial performance and entity also issues flows; and related to past service applying IFRS 17;
cash flows. insurance contracts. (iii) a risk adjustment for allocated to the group at that (c) the nature and extent of
non-financial risk. date. the risks that arise from
This Standard is applicable for annual (b) the contractual service insurance contracts.
periods beginning on or after 1 January margin (“CSM”)
2023, including the amendments that
were issued in June 2020.

**IFRS 17 is the latest development of IFRS, and it is the last IFRS so far. Now, IAS 1 will be presented in the next slide. 15
 IAS 1- Presentation of Financial Statements
Objective Scope Requirement of IAS 1
IAS 1 sets out the overall requirements for IAS 1 applies to all general-purpose financial • Fair presentation and compliance with IFRS.
financial statements, including how they should statements that are prepared and presented in • Going concern.
be structured, the minimum requirements for accordance with International Financial Reporting • Accrual basis of accounting.
their content and overriding concepts such as Standards (IFRSs). • Consistency of presentation.
going concern, the accrual basis of accounting • Materiality and aggregation.
and the current/non-current distinction. General purpose financial statements are those • Offsetting.
intended to serve users who are not in a position • Comparative information.
The standard requires a complete set of to require financial reports tailored to their • Reporting period.
financial statements to comprise a statement of particular information needs. • Current and non-current classification.
financial position, a statement of profit or loss • Line items.
and other comprehensive income, a statement • Choice in presentation and basic requirements.
of changes in equity and a statement of cash • Judgements and key assumptions.
flows. • Dividends notes.
• Capital disclosures.
• Any other relevant information related to the reporting
of the assets and liabilities.

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 IAS 2- Inventories
Objective Scope Recognition & Measurement Disclosure Requirements
The objective of IAS 2 is to prescribe the Inventories include assets Inventories are required to be stated at the • Accounting policy for inventories.
accounting treatment for inventories. It held for sale in the ordinary lower of cost and net realizable value (NRV). • Carrying amount, generally
provides guidance for determining the course of business (finished classified as merchandise, supplies,
cost of inventories and for subsequently goods), assets in the Cost should include all: materials, work in progress, and
recognizing an expense, including any production process for sale in • costs of purchase (including taxes, finished goods. The classifications
write-down to net realizable value. the ordinary course of transport, and handling) net of trade depend on what is appropriate for
business (work in process), discounts received; the entity
It also provides guidance on the cost and materials and supplies • costs of conversion (including fixed and • Carrying amount of any inventories
formulas that are used to assign costs to that are consumed in variable manufacturing overheads); and carried at fair value less costs to
inventories. production (raw materials). • other costs incurred in bringing the sell.
inventories to their present location and • Amount of any write-down of
It also outlines acceptable methods of condition inventories recognized as an
determining cost, including specific expense in the period
identification (in some cases), first-in NRV is the estimated selling price in the • Cost of inventories recognized as
first-out (FIFO) and weighted average ordinary course of business, less the expense (cost of goods sold)
cost. estimated cost of completion and the
estimated costs necessary to make the sale.

**IAS 3-6 are not commonly used, so IAS 7 will be presented in the next slide. 17
 IAS 7- Statement of Cash Flows
Objective Scope Presentation of a statement of cash flows
IAS 7 requires an entity to An entity shall prepare a Operating activities: Operating activities are the principal revenue producing activities of the
present a statement of cash statement of cash flows in entity and other activities that are not investing or financing activities. Operating cash flows are
flows as an integral part of its accordance with the reported using either the direct (recommended) or the indirect method.
primary financial statements. requirements of this
IAS 7 requires a statement of standard and shall present Cash flows from taxes on income are classified as operating unless they can be specifically
cash flows to present it as an integral part of its identified with financing or investing activities.
information about changes in financial statements for
cash and cash equivalents. each period for which Investing activities: Investing activities are the acquisition and disposal of long-term assets and
financial statements are other investments not included in cash equivalents.
Cash flows are classified and presented.
presented into operating Financing activities: Financing activities are activities that result in changes in the size and
activities (either using the composition of the contributed equity and borrowings of the entity.
'direct' or 'indirect' method),
investing activities or financing Aggregate cash flows from obtaining or losing control of subsidiaries are presented separately and
activities, with the latter two classified as investing activities. Investing and financing transactions that do not require the use of
categories generally presented cash are excluded from the statement of cash flows but need to be disclosed.
on a gross basis.
Entities must reconcile the opening and closing amounts in the statement of financial position for
items classified as financing activities.

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 IAS 8- Accounting Policies, Changes in Accounting
Estimates and Errors
Objective Changes in Accounting Changes in Accounting Disclosure Requirements
Policies Estimates
IAS 8 is applied in selecting and Accounting policies must be Changes in accounting • The title of the standard or interpretation
applying accounting policies, applied consistently to similar estimates (e.g. change in causing the change.
accounting for changes in estimates transactions. useful life of an asset) are • The nature of the change in accounting policy.
and reflecting corrections of prior When a change in accounting accounted for prospectively, in • A description of the transitional provisions,
period errors. policy is required by an IFRS the current year, or future including those that might have an effect on
Standard, the pronouncement’s years, or both. future periods.
The standard requires compliance transitional requirements are • For the current period and each prior period
with any specific IFRS applying to a followed. The comparative information is presented, to the extent practicable, the amount
transaction, event or condition, and not restated. of the adjustment:
provides guidance on developing Prior Period Errors: • for each financial statement line item
accounting policies for other items All material prior period errors are affected, and
that result in relevant and reliable corrected by restating • for basic and diluted earnings per share.
information. Changes in accounting comparative prior period amounts • The amount of the adjustment relating to
policies and corrections of errors are and, if the error occurred before periods before those presented, to the extent
generally retrospectively accounted the earliest period presented, by practicable.
for, whereas changes in accounting restating the opening statement • If retrospective application is impracticable, an
estimates are generally accounted of financial position. explanation and description of how the change
for on a prospective basis. in accounting policy was applied.

**IAS 9 is not commonly used, so IAS 10 will be presented in the next slide. 19
 IAS 10- Events after the Reporting Period
Objective Scope Adjusting Event Non-adjusting Event Recognition

IAS 10 contains requirements This Standard shall The financial The financial statements are not Non-adjusting events should be
for when events after the end be applied in the statements are adjusted for events that arose after disclosed if they are of such
of the reporting period should accounting for, and adjusted for events the end of the reporting period e.g., importance that non-disclosure
be adjusted in the financial disclosure of, that provide evidence a decline in market prices after year would affect the ability of users to
statements. events after the of conditions that end). make proper evaluations and
reporting period. existed at the end of decisions.
Adjusting events are those the reporting period However, if the events after the end The required disclosures are:
providing evidence of e.g., the resolution of a of the reporting period indicate that (a) The nature of the event, and
conditions existing at the end court case after the the going concern assumption is not (b) An estimate of its financial effect
of the reporting period, end of the reporting appropriate, those financial or a statement that a reasonable
whereas non-adjusting events period). statements are not prepared on a estimate of the effect cannot be
are indicative of conditions going concern basis. made.
arising after the reporting
period (the latter being Dividend proposed or declared after Companies must disclose the date
disclosed where material). the end of the reporting period are when the financial statements were
not recognized as a liability at the authorized for issue and who gave
end of the reporting period. that authorization.

**IAS 11 is not commonly used, so IAS 12 will be presented in the next slide. 20
 IAS 12- Income Taxes
Objective Current Tax & Deferred Tax Recognition of deferred tax Measurement of Disclosure Requirements
assets deferred tax
The objective of IAS 12 is to Current Tax: Current tax for Deferred tax liabilities are recognized Deferred tax assets and • Major components of tax expense.
prescribe the accounting treatment current and prior periods shall, for the future tax consequences of all liabilities are measured Examples include:
for income taxes. In meeting this to the extent unpaid, be taxable temporary differences, except: at the tax rates that are • Current tax expense/income any
objective, IAS 12 notes the recognized as a liability. If the • liabilities arising from initial expected to be applied to adjustments of taxes of prior periods.
following: amount already paid in respect recognition of goodwill. the period when the • Amount of deferred tax
of current and prior periods • liabilities arising from the initial asset is realized or the expense\income relating to the
-It is inherent in the recognition of exceeds the amount due for recognition of an asset/liability liability is settled, based origination and reversal of temporary
an asset or liability that asset or those periods, the excess shall other than in a business on tax rates/laws that differences.
liability will be recovered or settled, be recognized as an asset. combination. have been enacted or • Amount of deferred tax
and this recovery or settlement may • liabilities arising from temporary substantively enacted by expense/income relating to changes
give rise to future tax consequences Deferred Tax: Deferred tax differences associated with the end of the reporting in tax rates or the imposition of new
which should be recognized at the assets and liabilities are the investments in subsidiaries, period. taxes.
same time as the asset or liability income taxes recoverable or branches, and associates, and • Amount of the benefit arising from a
payable in future periods as a interests in joint arrangements. previously unrecognized tax loss, tax
-An entity should account for the tax result of differences between credit or temporary difference of a
consequences of transactions and the amounts attributed to assets A deferred tax asset is recognized for prior period.
other events in the same way it and liabilities from applying IFRS deductible temporary differences, • Write down, or reversal of a previous
accounts for the transactions or Standards and the amounts unused tax losses and unused tax write down, of a deferred tax asset.
other events themselves. those assets and liabilities are credits to the extent it is probable that • Amount of tax expense/income
attributed for tax purposes taxable profit will be available against relating to changes in accounting
(called temporary differences). which the deductible temporary policies and corrections of errors.
differences can be utilized.

**IAS 13-15 are not commonly used, so IAS 16 will be presented in the next slide. 21
 IAS 16- Property, Plant and Equipment
Objective Scope Initial Measurement Subsequent Disclosure Requirements
Measurement
The objective of IAS 16 is to IAS 16 applies to the An item of property, plant IAS 16 permits two • Basis for measuring
prescribe the accounting accounting for property, and equipment should accounting models for carrying amount.
treatment for property, plant, plant and equipment, except initially be recorded at cost. subsequent measurement • Depreciation method(s)
and equipment. The principal where another standard as follows: used.
issues are the recognition of requires or permits differing • Cost model. • Useful lives or depreciation
assets, the determination of accounting treatments. • Revaluation model. rates.
their carrying amounts, • Gross carrying amount and
recognition of depreciation accumulated depreciation
charges and impairment losses. and impairment losses.

**IAS 17-18 are not commonly used, so IAS 19 will be presented in the next slide. 22
 IAS 19- Employee Benefits
Objective Scope Defined Benefit plan Defined Contribution Plan Disclosure
The objective of IAS IAS 19 applies to: A liability (or asset) is recognized equal to For defined contribution plans, the • An explanation of the
19 is to prescribe • Short-term the net of the present value of the amount recognized in the period is characteristics of an
the accounting and employee benefits; obligations under the defined benefit plan the contribution payable in entity's defined benefit
disclosures for such as wages and and the fair value of the plan assets at the exchange for service rendered by plans, and the
employee benefits, salaries, bonuses end of the reporting period. employees during the period. associated risks.
requiring an entity and paid holidays. • Identification and
to recognize a • Post-employment The present value is calculated using a rate Contributions to a defined explanation of the
liability where an benefits; such as determined with reference to market contribution plan which are not amounts arising in the
employee has pensions and post- yields on high-quality corporate bonds. expected to be wholly settled financial statements
provided service retirement health within 12 months after the end of from defined benefit
and an expense cover. The measurement of a net defined benefit the annual reporting period in plans.
when the entity • Other long-term liability or assets requires the application which the employee renders the • A description of how
consumes the employee benefits; of an actuarial valuation method, the related service are discounted to the defined benefit
economic benefits such as sabbatical attribution of benefits to periods of their present value. plans may affect the
of employee and long service service, and the use of actuarial amount, timing and
service. leave. assumptions. uncertainty of the
• Termination entity's future cash
benefits; such as The fair value of any plan assets is flows.
redundancy and deducted from the present value of the
severance pay. defined benefit obligation in determining
the net deficit or surplus.

23
 IAS 20- Accounting for Government Grants and
Disclosure of Government Assistance
Objective Scope Accounting for grants Disclosure Requirements
IAS 20 outlines how to IAS 20 applies to A government grant is recognized only when there is reasonable assurance • Accounting policy adopted for
account for government all government that: grants, including method of
grants and other assistance. grants and other (a) the entity will comply with any conditions attached to the grant and balance sheet presentation.
Government grants are forms of (b) the grant will be received. • Nature and extent of grants
recognized in profit or loss government recognized in the financial
The grant is recognized as income over the period necessary to match
on a systematic basis over assistance. statements.
them with the related costs, for which they are intended to compensate,
the periods in which the • Unfulfilled conditions and
on a systematic basis.
entity recognizes expenses contingencies attaching to
for the related costs for Non-monetary grants are usually recognized at fair value, although recognized grants.
which the grants are recognition at nominal value is permitted. • Government grants do not
intended to compensate, include government
which in the case of grants A grant receivable as compensation for costs already incurred or for assistance whose value
related to assets requires immediate financial support, with no future related costs, should be cannot be reasonably
setting up the grant as recognized as income in the period in which it is receivable. measured, such as technical
deferred income or A grant relating to assets may be presented in one of two ways: or marketing advice and this
deducting it from the • as deferred income, or should be disclosed.
carrying amount of the • by deducting the grant from the asset's carrying amount.
asset.
A grant relating to income may be reported separately as 'other income' or
deducted from the related expense.

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 IAS 21- The Effects of Changes in Foreign Exchange
Rates
Objective Scope Initial Subsequent Disclosure Requirements
Recognition Measurement
IAS 21 outlines how to account This Standard shall be applied A foreign currency At each subsequent • The amount of exchange differences
for foreign currency transactions to: transaction should balance sheet date: recognized in profit or loss.
and operations in financial (a) in accounting for be recorded initially • Foreign currency • Net exchange differences recognized
statements, and also, how to transactions and balances in at the rate of monetary amounts in other comprehensive income and
translate financial statements foreign currencies, except for exchange prevailing should be reported accumulated in a separate
into a presentation currency. those derivative transactions at the date of the using the closing rate. component of equity.
and balances that are within transaction (use of • Non-monetary items • When the presentation currency is
An entity is required to the scope of IFRS 9 Financial averages is carried at historical different from the functional
determine a functional currency Instruments; permitted if they cost should be currency, disclose that fact together
(for each of its operations if (b) in translating the results and are a reasonable reported using the with the functional currency and the
necessary) based on the primary financial position of foreign approximation of exchange rate at the reason for using a different
economic environment in which operations that are included in actual). date of the presentation currency.
it operates and generally the financial statements of the transaction. • A change in the functional currency
records foreign currency entity by consolidation or the • Non-monetary items of either the reporting entity or a
transactions using the spot equity method; and carried at fair value significant foreign operation and the
conversion rate to that (c) in translating an entity’s should be reported at reason, thereof.
functional currency on the date results and financial position the rate that existed
of the transaction. into a presentation currency. when the fair values
were determined.

**IAS 22 is not commonly used, so IAS 23 will be presented in the next slide. 25
 IAS 23- Borrowing Costs
Objective Scope Recognition Measurement Disclosure
Requirements
IAS 23 prescribes the Two types of assets that Borrowing costs directly attributable Where funds are borrowed specifically, costs -Amount of
accounting when would otherwise be to the acquisition or construction of a eligible for capitalization are the actual costs borrowing cost
borrowings are made qualifying assets are qualifying asset are included in the incurred less any income earned on the capitalized during
to acquire or construct excluded from the scope cost of that asset. All other borrowing temporary investment of such borrowings. the period.
an asset. of IAS 23: costs are expensed when incurred.
• Qualifying assets Where funds are part of a general pool, the -Capitalization rate
Borrowing costs measured at fair A qualifying asset is one that takes a eligible amount is determined by applying a used.
include interest on value, such as substantial period of time to make it capitalization rate to the expenditure on that
bank overdrafts and biological assets ready for its intended use or sale. If asset. The capitalization rate will be the
borrowings, finance accounted for under funds are borrowed generally and weighted average of the borrowing costs
charges on finance IAS 41 Agriculture. used for the purpose of obtaining a applicable to the general pool.
leases and exchange • Inventories that are qualifying asset, a capitalization rate
differences on foreign (using a weighted average of the Capitalization should be suspended during
manufactured, or
currency borrowings borrowing costs over the period) is periods in which active development is
otherwise produced,
where they are used. interrupted.
in large quantities on
regarded as an a repetitive basis and
The borrowing costs eligible for Capitalization should cease when
adjustment to interest that take a
capitalization cannot exceed the substantially all of the activities necessary to
costs. substantial period to
amount of borrowing costs incurred. prepare the asset for its intended use or sale
get ready for sale. are complete.

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 IAS 24- Related Party Disclosures
Objective Scope Related Parties Disclosure Requirements
IAS 24 sets out disclosure This Standard shall be Parties are considered to be related if one party • Name of parent (and ultimate
requirements to make investors applied in: has the ability to control the other party or controlling party) irrespective of
aware that the financial position (a) identifying related exercise significant influence over the other whether transactions have occurred.
and results of operations may have party relationships and party’s financial and operating policies. • Compensation to key management
been affected by the existence of transactions; a) An entity that has control, joint control or personnel broken down by:
related parties. (b) identifying outstanding significant influence over another entity • Short-term benefits.
balances, including e.g., a parent-subsidiary or parent- • Post-employment benefits.
IAS 24 requires disclosures about commitments, between an associate or parent-joint venture • Other long-term benefits.
transactions and outstanding entity and its related relationship would be a related party • Termination benefits.
balances with an entity's related parties; relationship. • Share-based payments.
parties. The standard defines (c) identifying the b) Two subsidiaries of the same parent • When transactions have occurred:
various classes of entities and circumstances in which company would also be related parties • Nature of relationship (names do
people as related parties and sets disclosure of the items in because they are under common control. not need to be disclosed).
out the disclosures required in (a) and (b) is required; and c) Directors/key management. • Amount.
respect of those parties, including (d) determining the d) Close family members of the above. • Outstanding balance.
the compensation of key disclosures to be made e) Shareholders controlling >20% of the • Doubtful debt allowances.
management personnel. about those items. voting rights of the entity. • Bad and doubtful debt expense.
f) Post-employment benefit plans for the • Similar items may be disclosed in
benefit of employees. aggregate except where separate
disclosure is necessary for the
undertaking.

**IAS 25-26 are not commonly used, so IAS 27 will be presented in the next slide. 27
 IAS 27- Separate Financial Statements
Objective Scope Recognition Disclosure Requirements

IAS 27 outlines the accounting This Standard shall be In separate financial statements, investments in • When a parent elects not to prepare
and disclosure requirements applied in accounting subsidiaries, associates and joint ventures are consolidated financial statements and
for 'separate financial for investments in accounted for either at: instead prepares separate financial
statements', which are financial subsidiaries, joint • cost or statements, it shall be disclosed.
statements prepared by a ventures and • as investments in accordance with IFRS 9 or
parent, or an investor in a joint associates when an • using the equity method as described in IAS • When an investment entity that is a parent
venture or associate, where entity elects or is 28. prepares separate financial statements as
those investments are required by local its only financial statements, it shall
accounted for either at cost or regulations to present The entity shall apply the same accounting for disclose that fact.
in accordance with IFRS 9- separate financial each category of investments.
Financial Instruments. statements.
Investments accounted for at cost or using the
equity method shall be accounted for in
accordance with IFRS 5- Non- current Assets Held
for Sale and Discontinued Operations when they
are classified as held for sale or for distribution.

28
 IAS 28- Investments in Associates and Joint
Ventures
Objective Scope Significant Influence Accounting Method

IAS 28 outlines how to apply, IAS 28 applies to all Where an entity holds 20% or more of the voting The equity method is used to account for
with certain limited exceptions, entities that are power (directly or through subsidiaries) on an investments in associates and joint ventures.
the equity method to investors with joint investee, it will be presumed the investor has
investments in associates and control of or significant influence unless it can be clearly Equity Method: The investment is recorded
joint ventures. significant influence demonstrated that this is not the case. initially at cost and is subsequently adjusted by
over an investee The existence of significant influence by an entity the investor’s share of changes in the investee’s
The standard also defines an (associate or joint is usually evidenced in one or more of the net assets.
associate by reference to the venture). following ways:
concept of "significant • Representation on the board of directors or However, if the investor is a venture capital firm,
influence", which requires power equivalent governing body of the investee. mutual fund, unit trust or a similar entity, it can
to participate in financial and elect to measure such investments at fair value
• Participation in the policy-making process,
operating policy decisions of an through profit or loss in accordance with IFRS 9.
including participation in decisions about
investee (but not joint control or
control of those policies). dividends or other distributions. When the investor is presenting its separate
• Verify material transactions between the financial statements, it accounts for an
entity and the investee. investment in an associate or a joint venture in
accordance with IAS 27.
• Interchange of managerial personnel.
• Provision of essential technical information

**IAS 29-31 are not commonly used, so IAS 32 will be presented in the next slide. 29
 IAS 32- Financial Instruments: Presentation
Objective Scope Classification Compound Financial Instrument Disclosure
Requirements
IAS 32 outlines the IAS 32 applies in The fundamental principle of Some financial instruments – sometimes called Financial instruments
accounting requirements presenting and IAS 32 is that a financial compound instruments – have both a liability disclosures are in IFRS 7-
for the presentation of disclosing instrument should be classified and an equity component from the issuer's Financial Instruments:
financial instruments, information about as either a financial liability or perspective. Disclosures, and no longer
particularly as to the all types of an equity instrument in IAS 32.
classification of such financial according to the substance of In that case, IAS 32 requires that the
instruments into financial instruments. the contract, not its legal form, component parts be accounted for and
assets, financial liabilities and the definitions of financial presented separately according to their
and equity instruments. liability and equity instrument. substance based on the definitions of liability
The standard also provide The entity must make the and equity.
guidance on the decision at the time the
classification of related instrument is initially When the initial carrying amount of a
interest, dividends and recognized. The classification is compound financial instrument is required to
gains/losses, and when not subsequently changed be allocated to its equity and liability
financial assets and based on changed components, the equity component is
financial liabilities can be circumstances. assigned the residual amount after deducting
offset. from the fair value of the instrument as a
whole the amount separately determined for
the liability component.

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 IAS 33- Earnings per Share
Objective Scope Basic and Diluted EPS Retrospective Adjustment Disclosure Requirements

IAS 33 sets out how to IAS 33 applies to entities Basic EPS is calculated by The calculation of basic and Following disclosures are required:
calculate both basic whose securities are dividing profit or loss diluted EPS for all periods • the amounts used as the numerators in
earnings per share (EPS) publicly traded or that attributable to ordinary presented is adjusted calculating basic and diluted EPS, and a
and diluted EPS. are in the process of equity holders of the retrospectively when the reconciliation of those amounts to profit
issuing securities to the parent entity (the number of ordinary or potential or loss attributable to the parent entity
The calculation of Basic public. numerator) by the ordinary shares outstanding for the period.
EPS is based on the weighted average number increases as a result of a • the weighted average number of
weighted average Other entities that of ordinary shares capitalization, bonus issue, or ordinary shares used as the
number of ordinary choose to present EPS outstanding (the share split, or decreases as a denominator in calculating basic and
shares outstanding information must also denominator) during the result of a reverse share split. diluted EPS,
during the period, comply with IAS 33. period. • a description of those ordinary share
whereas diluted EPS If such changes occur after the transactions or potential ordinary share
also includes dilutive If both parent and Diluted EPS is calculated balance sheet date but before transactions that occur after the balance
potential ordinary consolidated statements by adjusting the earnings the financial statements are sheet date and that would have changed
shares (such as options are presented in a single and number of shares for authorized for issue, the EPS significantly the number of ordinary
and convertible report, EPS is required the effects of dilutive calculations for those and any shares or potential ordinary shares
instruments) if they only for the consolidated options and other dilutive prior period financial outstanding at the end of the period if
meet certain criteria. statements. potential ordinary shares. statements presented are based those transactions had occurred before
on the new number of shares. the end of the reporting period.
Disclosure is required.

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 IAS 34- Interim Financial Reporting
Objective Scope Minimum content of an interim financial report Accounting Policies
IAS 34 applies when an entity An interim financial report The minimum components specified for an interim The same accounting policies should be
prepares an interim financial is a complete or financial report are: applied for interim reporting as are
report, without mandating condensed set of financial • A condensed balance sheet (statement of financial applied in the entity's annual financial
when an entity should statements for a period position). statements, except for accounting policy
prepare such a report. shorter than an entity’s full • Either: changes made after the date of the
financial year. • a condensed statement of comprehensive most recent annual financial statements
Permitting less information income; or that are to be reflected in the next
to be reported than in annual IAS 34 applies only when an • a condensed statement of comprehensive annual financial statements.
financial statements (on the entity is required by a income and a condensed income statement.
basis of providing an update regulator or elects to • A condensed statement of changes in equity. A key provision of IAS 34 is that an
to those financial publish an interim financial • A condensed statement of cash flows, entity should use the same accounting
statements), the standard report in accordance with • Selected explanatory notes, policy throughout a single financial year.
outlines the recognition, IFRS Standards. If a complete set of financial statements is published in
measurement and disclosure the interim report, those financial statements should be If a decision is made to change a policy
requirements for interim in full compliance with IFRS. mid-year, the change is implemented
reports. retrospectively, and previously reported
If the annual financial statements were consolidated interim data is restated.
(group) statements, the interim statements should be
group statements as well.

**IAS 35 is not commonly used, so IAS 36 will be presented in the next slide. 32
 IAS 36- Impairment of Assets
Objective Scope Indications of impairment Recognition Disclosure Requirements
IAS 36- Impairment of IAS 36 applies to assets that External sources: An impairment loss is Disclosures by class of assets:
Assets sets out are not in the scope of other • Market value declines. recognized when the • Impairment losses recognized
requirements to Standards. Assets that have • Negative changes in technology, carrying amount of an in profit or loss
ensure that assets are separate requirements are markets, economy, or laws. asset exceeds its • Impairment losses reversed in
carried at no more inventories (IAS 2), contract • Increases in market interest rates. recoverable amount. profit or loss.
than their recoverable assets and costs to fulfil a • Net assets of the company higher • Relevant line item(s) of the
amount and to contract (IFRS 15), deferred than market capitalization. An impairment loss is statement of comprehensive
prescribe how tax assets (IAS 12), assets Internal sources: recognized in profit or income.
recoverable amount from employee benefits (IAS • Obsolescence or physical damage. loss for assets carried at • Impairment losses on
and an impairment 19), financial assets (IFRS 9), • Asset is idle, part of a restructuring cost and treated as a revalued assets recognized in
loss or its reversal are investment property or held for disposal. revaluation decrease for other comprehensive income.
calculated. measured at fair value (IAS • Worse economic performance than assets carried at the • Impairment losses on
40), biological assets expected for investments in revalued amount. revalued assets reversed in
measured at fair value less subsidiaries, joint ventures or other comprehensive income.
costs to sell (IAS 41), associates, the carrying amount is Reversal of prior years’ Disclosure by reportable segment:
contracts in the scope of IFRS higher than the carrying amount of impairment losses is • Impairment losses recognized.
17 and non-current assets the investee's assets, or a dividend required in some cases • Impairment losses reversed.
classified as held for sale exceeds the total comprehensive but is prohibited for
(IFRS 5). income of the investee. goodwill.

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 IAS 37- Provisions, Contingent Liabilities and Contingent
Assets
Objective Scope Recognition Disclosure Requirements
IAS 37 outlines the accounting for IAS 37 excludes obligations and A provision should be recognized • Reconciliation for each class of
provisions (liabilities of uncertain contingencies arising from: when: provision:
timing or amount), together with • Financial instruments that are in – an entity has a present obligation • Opening balance, additions,
contingent assets (possible assets) the scope of IFRS 9- Financial (legal or constructive) as a result of a unused amounts, reversed
and contingent liabilities (possible Instruments. past event; unwinding of the discount, or
obligations and present obligations • non-onerous executory contracts. – it is probable that there will be an changes in discount rate,
that are not probable or not • insurance contracts (See IFRS 17- outflow of resources in the form of closing balance.
reliably measurable). Insurance Contracts). cash or other assets; and
• items covered by another IFRS. – a reliable estimate can be made of • A prior year reconciliation is not
Provisions are measured at the For example, IAS 12- Income Taxes the amount. required.
best estimate (including risks and applies to obligations for current
uncertainties) of the expenditure or deferred income taxes; IFRS 16- A provision should not be recognized • For each class of provision, a brief
required to settle the present Leases applies to lease in respect of future operating losses description of:
obligation and reflects the present obligations; and IAS 19- Employee since there is no • Nature, timing, uncertainties,
value of expenditures required to Benefits applies to pension and present obligation arising from a past assumptions, reimbursement, if
settle the obligation where the other employee benefit event. any.
time value of money is material. obligations.
Contingent assets and contingent • Contingent assets and contingent
liabilities should not be recognized liabilities
but should be disclosed.

34
 IAS 38- Intangible Assets
Objective Scope Recognition Subsequent Measurement Disclosure Requirements

IAS 38 prescribes IAS 38 applies to all Intangible assets are recognized if it is Intangible assets are classified For each class of intangible asset,
the accounting intangible assets other probable that the future economic as having either a disclosures include:
treatment for than: benefits that are attributable to the asset finite or indefinite life. • Useful life or amortization
recognizing, • financial assets (IAS will flow to the entity and the cost of the rate.
measuring and 32). asset can be measured reliably. There are Indefinite means that there • Amortization method.
disclosing • exploration and specific recognition criteria for internally is no foreseeable limit to the • Gross carrying amount.
intangible assets evaluation assets generated intangible assets. period over which the • Accumulated amortization
that are not dealt (IFRS 6). asset is expected to generate and impairment losses.
with in another • intangible assets All research costs are charged to expense net cash inflows, not infinite. • Line items in the income
IFRS Standard. arising from when incurred. Development costs are statement in which
insurance contracts. capitalized only after technical and Intangible assets may be amortization is included.
• intangible assets commercial feasibility of the resulting accounted for using: • Basis for determining that an
covered by another product or service have been established. • A cost model or, in limited intangible has an indefinite
IFRS (IFRS 5, IAS 12, cases. life
IFRS16, IAS 19 and Internally-generated goodwill, brands, • A revaluation model. • Description and carrying
IFRS 3). mastheads, publishing titles, customer amount of individually
lists, start-up costs, training costs, material intangible assets.
advertising costs and relocation costs are
never recognized as assets.

**IAS 39 are not commonly used, so IAS 40 will be presented in the next slide. 35
 IAS 40- Investment Property
Objective Scope Recognition & measurement Subsequent Measurement Disclosure Requirements
IAS 40 prescribes This Standard Investment property should be An entity chooses after initial • Whether the fair value or the cost model is
the accounting shall be applied recognized as an asset when it is recognition, either: used.
when property is in the probable that the future • the fair value model or • If the fair value model is used, whether
held to earn rentals recognition, economic benefits that are • the cost model. property interests held under operating
or for capital measurement associated with the property will leases are classified and accounted for as
appreciation rather and disclosure flow to the entity, and the cost of The chosen measurement investment property.
than being occupied of investment the property can be reliably model is applied to all of the • If classification is difficult, the criteria to
by the owner for property. measured. entity’s investment property. distinguish investment property from owner-
the production or occupied property and from property held for
supply of goods or An investment property is Change from one model to the sale.
services or for measured initially at cost. other is permitted if it will • The extent to which the fair value of
administrative result in a more appropriate investment property is based on a valuation
purposes Transaction costs are included in presentation (which is highly by a qualified independent valuer; if there
the initial measurement unlikely for change from fair has been no such valuation, that fact must be
value to cost model). disclosed.
• The amounts recognized in profit or loss.
• Contractual obligations to purchase,
construct, or develop investment property or
for repairs, maintenance or enhancements.

36
References:
• International Financial Reporting Standards (IFRS) issued by IASB as adopted by
FRC of Bangladesh and The Institute of Chartered Accountants of Bangladesh
(ICAB).
• IAS Plus by Deloitte. Accessed from: https://www.iasplus.com/en/standards/ifrs
• IFRS in your pocket (2021) by Deloitte.

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