- This topic has 5 replies, 2 voices, and was last updated 5 years ago by
.
- Posts
1. for gearing ratio, can we use either Debt/Equity or Debt/(equity+debt) for analytical procedures ?
2. may i know what is it mean by “measurement” in this phrase “measurement requirements of applicable financial reporting framework” ?
this measurement refers to how it has been recognized on recognition ? or comprehensively referring to amount, recognition, valuation, classification, presentation and disclosure ?
3. adjusting events are those events that provide evidence of conditions at the reporting date.
This”at the reporting date” refers to the financial year e.g 1 January 2019 – 31 December 2019 ?
1. Yes – the first is more sensitive (will show bigger change) because the denominator will be smaller
2. In IFRS the vast majority of standards are broken down into sections (as applicable)- introduction – objective – scope – definitions – recognition – MEASUREMENT – presentation – disclosure …. appendices. So measurement is just one part – usually split between:
– Initial measurement (almost invariably “cost”)
– Subsequent measurement – e.g. depreciated cost (PPE), lower of cost and NRV (inventory), FV (investment property) etc.3. Yes
No – the reporting date is the END date of the reporting period.for number 3. may i know what is it mean by END date of the reporting period ?
because when i see in Kaplan textbook, “sale of inventory after the reporting date” is adjusting event while “major business combination after reporting date or disposal of subsidiary” is non adjusting.
Both events occurred after the reporting date but why former is adjusting while the latter is non adjusting ?
The last day! You gave a reporting period “1 January 2019 – 31 December 2019” – the SoFP will be presented “AS AT” 31 December 2019. This is the year end/reporting date. Events after the reporting period (“post balance sheet events”) will be events in 2020.
inventory was sold after the reporting date and the business combination happened after the reporting date but former is adjusting and the latter is non adjusting.
Both happened after 31 December 2019 which is after the reporting date but i can’t understand why they one is adjusting while the other one isn’t
sorry Kim, it’s abit hard to understand this concept even after reading opentuition lecture notes from SBL and some videos on youtube. It’s quite hard to understand…
IAS 10 Events after the Reporting Date is assumed knowledge of Financial Accounting (F3). An EVENT after 31.12.2019 will be either:
Adjusting – i.e. it provides evidence of a condition which EXISTED at the reporting date; or
NON-adjusting – i.e. the CONDITION did not exist at the reporting date.If you sell inventory after the year end for less than cost – that is EVIDENCE that NRV is less than cost at the year end.
- You must be logged in to reply to this topic.