Euromoney Audit Training

The move to IFRS is sweeping the world.

Examples of this trend include:

• As of 2005 the European Union requires that almost all of its more than
• 7,000 companies listed on European stock exchanges prepare their financial statements in accordance with IFRS.
• The US Securities & Exchange Commission (SEC) now allows foreign registrants listed in the US to prepare their financial statements using IFRS without reconciling to US GAAP and is considering a mandatory transition to IFRS for US domestic filers.
• Canada has agreed to adopt IFRS for its listed companies and is considering it for its small and medium sized companies.
• Australia and Hong Kong require listed companies to use IFRS.
• The Accounting Standards Board of Japan has been accelerating its revision of Japanese accounting standards to minimise differences with IFRS standards.
• India is in the process of adopting IFRS.
• Several Middle Eastern and South American countries have adopted IFRS and several more are considering it.

Accurately applying IFRS is a demanding process that requires planning and thought. As well as the technical accounting changes that  inevitably flow from the adoption of IFRS, the standards themselves are principles-based standards that require a good understanding of the underlying concepts as well as the application of extensive professional judgment. The application of IFRS also requires the use of fair values to record both transactions and determine balance sheet valuation for many financial assets and financial liabilities. This course will help delegates to understand the significant issues to address when applying IFRS.  Participants will also receive information on the latest developments and anticipated changes to IFRS, as well as insight on how to keep their knowledge up to date in the future. Using real-world company financial statements and other case studies, delegates will learn how put IFRS accounting principles into practice and also how to understand and interpret IFRS financial statements.

Through class discussions, numerous examples, analysis of financial statements and brief cases you will:

• Receive a comprehensive review of the most important IFRS standards and SIC / IFRIC interpretations 
• Understand the requirements and choices for IFRS financial statements
• Analyse and interpret IFRS financial statements
• Apply newly applicable IFRS amendments effective in the current year
• Be prepared to implement upcoming new requirements that will be effective in future years
• Receive information on the latest developments and anticipated changes in IFRS in order to plan ahead
• Become familiar with internet sources in order to maintain up-to-date knowledge
• Understand the progress to date on the convergence of local standards to IFRS throughout the world
• Put theory into practice with practical company case study exercises

Day 1

Introduction to IFRS

• Brief background of IFRS history and development

• Currently issued pronouncements and their effective dates

– Standards: IAS and IFRS

– Interpretations: SIC and IFRIC

• The IFRS Framework: elements, recognition and measurement

• Applying the hierarchy of international standards

• Current status of global convergence – worldwide IFRS application

• U.S. convergence projects and their impact on IFRS

• How to research and stay up to date on IFRS

 

CASE STUDY: Applying the IFRS Framework Principles in Real-world Situations

 

Financial Statements and Presentation Issues

 Presentation

·   IAS 1 Presentation of Financial Statements

– Statement of Financial Position

– Statement of Comprehensive Income

– Statement of Changes in Equity

·   IAS 7 Statement of Cash Flows

·   IFRS 5 Non-current Assets Held for Sale and Discontinued Operations

 Policies and Adjustments

·   IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors

·   IAS 10 Events after the Reporting Period

 Other Disclosure and Reporting Issues

·   IAS 24 Related Party Disclosures

·   IFRS 8 Operating Segments

 

CASE STUDIES:

• Review the New Disclosure and Presentation Requirements using Real World Financial Statements

• Determine the Treatment of Events after the Reporting Period

Day 2

 

Revenue Recognition

·   IAS 18 Revenue

- Definitions

- Revenue measurement, including gross vs. net reporting

- Exchange transactions (barter)

- Revenue from sale of goods, including recent recognition issues

- Revenue from services – recognition criteria and applications

- Revenue from interest, dividends and royalties

 

CASE STUDY: Practical Revenue Recognition and Application Scenarios

 

Inventory

• IAS 2 Inventory

- Definition

- Inventory measurement – determining cost

- Allocating overheads

- Write-downs to net realisable value and reversal considerations

 

Tangible and Intangible Assets

• IAS 16 Property, Plant and Equipment

• IAS 23 Borrowing Costs

• IAS 38 Intangible Assets

• IAS 40 Investment Property

• IFRS 5 Non-current Assets Held for Sale and Discontinued Operations

- Initial recognition and measurement, including asset retirement costs

- Treatment of subsequent expenditures

- Valuation methods

- Depreciation, including composite asset accounting

- Assets held for sale

- Interest capitalisation, including NEW requirements

- Investment property identification and accounting, including alternatives

- Treatment of internally generated intangible assets, including exceptions

- Accounting for research and development

 

CASE STUDIES:

• Property, Plant and Equipment – Recognition, Measurement and Revaluation

• Accounting for Asset Retirement Obligations

• Investment Property – Recognition, Valuation and Changes in Use

• Intangible Assets –Recognition, Measurement, and Subsequent Expenditures

 

Day 3

 

Impairment of Tangible and Intangible Assets

• IAS 36 Impairment of Assets

- Identifying an asset that may be impaired

- Determining the recoverable amount

- Measuring and recognising an impairment loss

- Identifying cash-generating units (CGU) and assigning assets

- Allocating losses to individual assets

- Reversing impairment losses

 

CASE STUDY: Evaluating the Impairment Testing of Goodwill and Determining Whether Impairment Should be Recognised

 

Provisions and Contingencies

• IAS 37 Provisions, Contingent Liabilities and Contingent Assets

- Understanding liabilities, contingencies and commitments

- Recognising and measuring provisions, including changes in estimate

- Applying contingency disclosure requirements

 

CASE STUDIES:

·         Distinguishing Between Liabilities, Provisions and Contingent Liabilities

·         Applying Recognition and Measurement Concepts to Determine Appropriate Accounting Treatment

·         Calculating the Correct Amount of Provision to Record in Various Situations

 

Employee Benefits

• IAS 19: Employee Benefits

- Short-term employee benefits

- Post-employment benefits – identifying plan types

- Accounting for defined contribution plans

- Accounting for defined benefit plans

- Recognising actuarial gains & losses, including the alternative treatments

- Financial statement recognition and requirements

 

CASE STUDY: Defined Benefit Plan Accounting

 

Leases

• IAS 17 Leases

- What is a lease according to IFRS?

- Classifying leases

- Accounting for lessee finance leases

- Accounting for lessee operating leases

- Accounting for lessor finance leases

- Accounting for lessor operating leases

- Operating lease incentives

 

CASE STUDIES: Identifying, Classifying and Accounting for Leases

 

Day 4

 

Financial Instruments

• IAS 32 Financial Instruments: Presentation

• IAS 39 Financial Instruments: Recognition and Measurement

• IFRS 7 Financial Instruments: Disclosures

• Overview of NEW IFRS 9 Financial Instruments: Classification and Measurement

- Classifying financial instruments

- Recognising and measuring financial instruments, both initially and subsequently

- Determining fair value

- Applying reclassification rules

- Derecognising financial assets and liabilities

- Recognising, calculating and reversing impairment losses

- Accounting for derivatives

- Identifying and classifying debt and equity instruments

- Meeting the disclosure requirements – IFRS 7 requirements

 

CASE STUDIES:

• Accounting for Financial Instruments – Classification

• Identifying Liabilities vs. Equity

• Applying the De-recognition Model

• Recognising and Calculating Impairment

• Applying the Effective Interest Method: Transaction Costs, Amortisation and Premiums/Discounts

 

Consolidations

• IAS 27: Consolidated and Separate Financial Statements

• SIC 12: Consolidation – Special Purpose Entities

- Consolidated financial statement requirements, including exemptions

- Consolidation procedures

- Non-controlling interest presentation

- Accounting in separate financial statements

 

CASE STUDY:  Special Purpose Entity Consolidation

 

Accounting for Associates

• IAS 28: Investments in Associates

- Identifying significant interest and associates

- Accounting requirements and exemptions

- Application of the equity method

 

CASE STUDY: Calculating Equity Method Balances

 

Accounting for Joint Ventures

• IAS 31: Interests in Joint Ventures

- Identifying joint ventures

- Joint venture types

- Accounting and presentation for each type of joint venture 

 

Foreign Currency Issues

• IAS 21 The Effects of Changes in Foreign Exchange Rates

- Definitions

- Determining the functional currency

- Reporting foreign currency transactions and recognising exchange differences

- Translating foreign entity financial statements

 

CASE STUDIES:

• Determining Functional Currency

• Identifying Monetary Items

• Measuring and Recognising Exchange Gains and Losses

• Translating Foreign Entity Financial Statements

 

Transitioning to IFRS

• Overview of IFRS 1 First-time Adoption of IFRS

– Basic principles of IFRS I

– Preparing the opening statement of financial position

– Mandatory exceptions from other IFRS

– Optional exemptions

– Presentation and disclosure requirements

 
CASE STUDY: Starting from a national GAAP financial statement, the IFRS 1 adjustments necessary to create the statement in accordance with IFRS are illustrated

• Karen Kalishek

  Karen Kalishek is an international instructor and consultant specialising in International Financial Reporting Standards (IFRS and US Generally Accepted Accounting Principles (US GAAP)). Karen also writes technical accounting material for publication and is a content author for IFRS and US GAAP e-learning programs.
  
  She is a US Certified Public Accountant (CPA), a Certified Management Accountant (CMA), a Certified Fraud Examiner (CFE) and earned an MBA from the University of Wisconsin. Prior to entering the international arena, she taught graduate level business and finance courses in the USA as well as CPA examination review courses. Karen was formerly Senior Vice-President in a regional bank holding company and also served for eight years on the accounting examination and licensing board of her state. Karen’s extensive experience and engaging teaching style have made her a popular instructor with many repeat clients.

  Courses run by this instructor

  • International Financial Reporting Standards (IFRS) - Dubai
  • International Financial Reporting Standards (IFRS) - Abu Dhabi

Interested in holding this course in-house? Please fill out your details and a member of our team will be in touch with more information.

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