IFRS Flashcards

Question 1

Q

The International Accounting Standards Board (IASB)

Question 2

Q

The International Financial Reporting Standards (IFRS) issued by the IASB

Question 3

Q

The IASB Framework

The framework is NOT a standard itself
The framework does not supersede any standard’s authority

Question 4

Q

To provide users with information on international accounting.

Question 5

Q

Entity is a Going Concern

Entity uses the accrual basis of accounting.

Question 6

Q

Relevance & Faithful Representation

Relevance - Makes a difference to the user
Includes:
Predictive Value - Future Trends
Confirming Value - Past Predictions

Faithful Representation
Includes:
Completeness - Nothing omitted that would impact the decision-making of a user
Neutrality - Information is presented is without bias
Free from Error - No material errors or omissions

Question 7

Q

Comparability - Allows users to compare different items among various periods
Verifiability - Different people would reach a similar conclusion on the information presented
Timeliness - Information is made available early enough to impact the decision making of users
Understandability - Information is easy to understand

Question 8

Q

Comparative information from prior year is required under IFRS.

GAAP requires that if multiple years are presented they are consistently prepared however it doesn’t require prior year comparative statements.

Question 9

Q

Cost vs. Benefit

Question 10

Q

Asset
Liability
Equity
Income
Expense

Question 11

Q

Probable future economic benefit

Can be measured reliably

If the value or outcome cannot be measured reliably IFRS requires the use of the Cost Recovery Method.

Question 12

Q

A full comparative statement using IFRS.

Question 13

Q

January 1 2011 because a full year of comparative statements is required from the previous year

Question 14

Q

The Fair Value election

Question 15

Q

In the entity’s retained earnings or equity

Question 16

Q

Going Concern is an assumption under IFRS

Question 17

Q

IFRS doesn’t allow extraordinary items.

Question 18

Q

Completed contract method is not allowed under IFRS.

Question 19

Q

IFRS does not allow LIFO.

Question 20

Q

Statement of Comprehensive Income

Statement of Changes in Equity

Question 21

Q

Income is used instead of revenue and encompasses BOTH revenue and gains.

Question 22

Q

In IFRS the term profit is used instead of Net Income.

Question 23

Q

They are treated the same as revenue and are not separated on the financial statements.

Question 24

Q

In IFRS losses are treated the same as expenses but they ARE separated on the financial statements.

Question 25

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Under IFRS current liabilities can only be refinanced into a non-current liability if the refinance agreement is EXECUTED prior to the balance sheet date.

GAAP requires only intent to refinance not actual execution.

Question 26

Q

Under GAAP there are three classifications of contingent liabilities - Probable Reasonably Possible and Remote.

Under IFRS contingencies are uncertain future events and are classified as a provision if probable and measurable even if uncertain in timing or amount.

Question 27

Q

Bonds may be recorded on the Statement of Financial Position using one of two methods

Fair Value through profit or loss

Liability revalued at the end of each period
Gain or Loss recognized in period

Amortized Cost
*Using Effective Interest Method

Question 28

Q

They use the liability method - all deferred tax liabilities must be reported but only probable deferred tax assets can be reported.

They are non-current on the statement of financial position.

Question 29

Q

ONLY if they are related to the same country/taxing authority

For example China Deferred Tax Assets can’t offset Japan Deferred Tax Liabilities

Question 30

Q

The enacted rate or substantially enacted tax rate.

GAAP is the enacted tax rate only

Question 31

Q

Income
Finance Costs
Tax Expense
Discontinued Ops
Profit/Loss
Non-controlling interest in Profit/Loss
Net profit/loss attributable from equity

Question 32

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Recorded at cost

Valued using either:

Cost model - asset carried at cost less accumulated depreciation and impairment loss

Revaluation model - asset adjusted to fair value less accumulated depreciation

Question 33

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Asset must be able to be reliably measured

Must be applied to whole class of assets not just one asset

No guidance on how often assets should be revalued under IFRS

Question 34

Q

Initially recorded at cost

Revalued using either Fair Value model or Cost model

Question 35

Q

Recorded on the Income Statement

Investment P/L : IS

PP&E P/L : OCI

Question 36

Q

Carried at Cost minus Accumulated Depreciation

Fair Value must still be disclosed in the notes to the financial statements

Question 37

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Operating Leases can be recorded as Investment Property if measured at Fair Value

All other investment property must use Fair Value Model if one asset uses it

Question 38

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Using either the Cost Model (cost less Accumulated Depreciation and Impairment Loss)

or

the Revaluation Model (Fair Value less Accumulated Depreciation)

Question 39

Q

It is not recognized.

Question 40

Q

If asset has a finite life it is amortized over useful life.

If asset has indefinite life it is not amortized but is tested for impairment at the reporting date.

Question 41

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If the substantial risks of ownership have passed to the Lessee then the Lease must be accounted for as a Finance Lease

Question 42

Q

Project-unit-credit method calculates the PV of the defined benefit obligation

Question 43

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They can be classified as either Operating or Financing

Once a classification is chosen all future costs must be classified there

Question 44

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They must be included in the notes to the financial statements.

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IFRS Flashcards

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