IFRS “International Financial Reporting Standards”

IFRS standards

IFRS is an international accounting framework, a set of accounting standards developed by the International Accounting Standards Board (IASB). Correctly organize and report financial information. It is derived from the statement of the London International Accounting Standards Board (IASB)

Currently, this is the accounting framework required by most countries around the world. IFRS requires companies to report their financial performance and financial status using the same rules; this means that unless any fraudulent operations are performed, the financial reports of all companies that use IFRS are quite uniform, which makes comparison and comparison of their financial The result becomes easier.

And here are all the IFRS standards:

  • IFRS 1 First-time Adoption of International Financial Reporting StandardsIFRS standards
  • IFRS 2 Share-based Payment
  • IFRS 3 Business Combinations
  • IFRS 4 Insurance Contracts
  • IFRS 5 Non-current Assets Held for Sale and Discontinued Operations
  • IFRS 6 Exploration for and Evaluation of Mineral Resources
  • IFRS 7 Financial Instruments: Disclosures
  • IFRS 8 Operating Segments

IFRS 9 Financial Instruments:

IFRS 9 is effective for annual periods beginning on or after 1 January 2018 with early application permitted.

IFRS 9 specifies how an entity should classify and measure financial assets, financial liabilities, and some contracts to buy or sell non-financial items.

IFRS 9 requires an entity to recognize financial assets or financial liabilities in its statement of financial position when it becomes a party to the terms of a financial instrument contract. At initial recognition, the entity measures the financial assets or financial liabilities at their fair value plus or minus; for financial assets or financial liabilities that are not measured at fair value and whose changes are included in the current profit or loss, they are directly attributed to the financial asset or financial liability Transaction costs. Purchase or issue financial assets or financial liabilities.

Financial assets When an entity first identifies a financial asset, it classifies it based on its business model for managing assets and the contractual cash flow characteristics of the asset, as follows:

Amortized costs of financial assets that meet the following two conditions are measured at amortized cost: Assets are held in a business model whose purpose is to hold assets to collect contractual cash flows; and

The contractual terms of financial assets generate cash flow on a specified date, which is only the payment of principal and outstanding principal interest.

– The fair value measured through other comprehensive income-If a financial asset is held in a business model that achieves its goal by collecting contractual cash flows and selling financial assets, it is classified and measured at fair value through other comprehensive income.

– Measured at fair value and its changes are included in the current profit and loss-Any financial assets that are not held in one of the above two business models are measured at fair value and their changes are included in the current profit and loss.

When and only if an entity changes its business model for managing financial assets, it must reclassify all affected financial assets.

  • IFRS 10 Consolidated Financial Statements
  • IFRS 11 Joint Arrangements
  • IFRS 12 Disclosure of Interests in Other Entities
  • IFRS 13 Fair Value Measurement
  • IFRS 14 Regulatory Deferral Accounts
  • IFRS 15 Revenue from Contracts with Customers:

IFRS 15 takes effect during the annual reporting period beginning on or after January 1, 2018, allowing early application.

IFRS 15 establishes the principles that entities apply when reporting information about the nature, amount, time, and uncertainty of revenue and cash flows from contracts with customers. According to IFRS 15, an entity recognizes revenue in an amount that reflects the consideration that the entity expects to be entitled to in exchange for these goods or services, to express the transfer of promised goods or services to customers.

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In order to recognize revenue based on IFRS 15, entities should use the following five steps:

-Determine the contract with the customer.

-Determine the performance obligations in the contract. Performance obligations are commitments to transfer significantly different goods or services to customers in the contract.

-Determine the transaction price. The transaction price is the amount of consideration that the enterprise expects to transfer the consideration goods or services to the customer in exchange. If the consideration promised in the contract includes a variable amount, the entity must estimate the consideration it is expected to be entitled to in exchange for transferring the promised goods or services to the customer.

– IFRS 16 Leases

IFRS 16 is effective for annual reporting periods beginning on or after January 1, 2019, and allows early adoption (as long as IFRS 15 is also adopted).

The purpose of IFRS 16 is to report the following information: (a) faithfully represent the lease transaction, and (b) provide a basis for financial statement users to evaluate the amount, timing and uncertainty of the cash flow generated by the lease. To achieve this goal, the lessee should recognize the assets and liabilities arising from the lease.

IFRS 16 introduces a single lessee accounting model and requires the lessee to confirm all leased assets and liabilities for leases longer than 12 months unless the value of the underlying asset is low. The lessee must recognize the right-of-use asset on its behalf to use the underlying lease asset and the lease liability on its behalf to pay the lease payment obligation.

IFRS 17 Insurance Contracts

IFRS 17 is effective for annual reporting periods beginning on or after January 1, 2021, and allows the simultaneous adoption of IFRS 9 and IFRS 15.

Insurance contracts have the functions of financial instruments and service contracts. In addition, the cash flows generated by many insurance contracts over a long period are highly variable.

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