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Below are few IFRS & Ind AS discussions which i am sure will interest you.

IFRS opportunities overseas - Smita our student speak's from Dubai


What we discuss?

Participant: Please what is the difference between accrued income and receivables?
IFRS MB: Receivables arise from bills raised while accrued income is from services rendered or construction completed but the portion for which bills not raised (generally due to terms of billing)
Participant: Both of them are current assets right?
IFRS MB: Yes if expected to be paid in 12 months or operating cycle whichever is higher
Participant: Ok. Thank you Sir
Participant: Note 1 – Revenue: On 29 March 2010 Delta sold goods for a total sales price of $7·5 million. The goods were sold by Delta at a mark-up of 25% on cost. The goods were supplied on a sale or return basis – the return period expiring on 30 June 2010. It was not possible to accurately estimate the extent to which these customers would exercise their rights to return the goods. Delta has treated this transaction as a normal sale and eliminated the goods from inventories. Trade receivables includes $7·5 million in respect of this transaction.
Participant: See the entries I proposed to handle it
Participant: Dr: Revenue $7.5m Cr: Trade Receivables $7.5m
Participant: Dr: Inventory $6m But I am at a loss as to which account to credit the corresponding $6m to. Is it cost of sales?
Participant: Good evening Sir. Please with respect to Construction Contract, what is the meaning of escalation clause?
IFRS MB: Price is variable depending on some portion linked to raw material cost e.g. Cement steel etc
Participant: Ok Sir
Participant: Cost to sell are increemental cost of asset June 2012 qn 3 ii
Participant: Rest is done sir
Participant: Thanks
Participant: Sir,Thanks for the wonderful session this morning. Please I have a quick clarification to make.In solving Dec 2011 Q2B, General administrative overheads of $150,000 per month were allocated to the contract using Epsilon’s normal cost allocation model.
In the answer booklet, this was not captured as part of cost of the contract. In my opinion, I believe it should be part of the cost of contract because the question specifically said, THE AMOUNT WAS ALLOCATED TO THE CONTRACT.
Participant: Please how do we account for damaged materials under lease?
IFRS MB: Depends on contract terms
Participant: Look at this Sir...
Participant: Kindly go thru this Sir and I will ask two questions after
Participant: June 2009 Q 5 - 1
Participant: 2. The account year end is conflicting.... is it 31 March or 30 April? Both periods were listed in the question
IFRS MB: Any abnormal cost cannot be capitalised so damaged material cannot be. It is charged to p and l
IFRS MB: Recording on ppe will make this point clear
IFRS MB: Will revert on point 2
Participant: Ok Sir
Participant: Thank you Sir
Participant: You may not bother Sir. I later noticed one hidden trick in the question
Participant: Thank you Sir
Participant: Are real estate developers covered under ias 11 ?
Participant: Good evening Sir. Kindly look at Dec 10 Q3b. I really want to know specifically why u treated it as PPE instead of Leasing. What is the guiding principle Sir?
IFRS MB: depends on risk and reward transferred
IFRS MB: to my memory I have treated as operating lease only. Want me to recheck??
Participant: But you handled it under PPE topics. Kindly recheck Sir and clarify. I will still listen to the video again when I get to the office. Perhaps I will have better explanation on why you did that. Thanks. Good morning Sir
IFRS MB: Oh now I understand it is coIFRS MBined example of lease and ppe. First 2 paras lease is operating lease.
Participant: What rate do we take practically to arive at fair value is it avg borowing rate or cost of capital?
Participant: if the leased term expired of finance lease and the Company purchase the asset at the end of the lease term then what will be the required disclosure in
the financial statements as the assets will appear in the financial statements of the Company
IFRS MB: In finance lease purchase of ppe is brought in books on day 1. So useful life should be over. So same what you do for normal ppe
IFRS MB: Pleased to inform you that now I am taken on state finance panel of CII. Confederation of Indian industries
Participant: I have question.. If a Co buys land one year n recognise it as asset
Participant: N 2nd year it constructs building for business
Participant: Will d building n land b shown in sofp as two different assets?
IFRS MB: Sofp has no such rules. As a practice ppe is shown one in ppe schedule property is shown as one. So all lands plus buildings are shown one title as property
Participant: So in 1st year it will be shown as land as there was no building
Participant: Later when building was started to be constructed will it be treated as CIP? N we would credit land to take out from books?
Participant: N once d building is ready for use it will be in ppe?
IFRS MB: Land will continue in property called as land. Not cwip
Participant: But won't it make investors think it's a saleable property if shown separately? However Co knows it's with d building
Participant: And won't b able to sale till dc building is demolished?
IFRS MB: Also investment property is held for appreciation or renting
IFRS MB: Saleable properties are to be shown as held for sale under ifrs 5
IFRS MB: Ppe is clearly for held for use in normal business
Participant: Sir, deceIFRS MBer 13 CSOFP, From BETa OCE, revaluation gain has not been deducted.
Participant: It should have been deducted for goodwill calc as well
Participant: Link wrongly sent
Participant: Sir in case of espp entry as said in lecture is exp Dr share capital cr. instead of share capital why it cannot be share prem as in the case of esop
IFRS MB: Right it should be share premium
IFRS MB: Anything beyond facevalue is share premium
IFRS MB: Will recheck and correct recording if required
Participant: K sir thanks
Participant: Sir in june 2011 4(1) one of conditions for issue of esop is share but the same was not met still amount is expensed in answer it is written it is ignored since market linked however share price of vesting date is not provided. Is it mean any type of market linked vesting condition is irrelevant if status on vesting date is not provided
IFRS MB: Does it mean any type of market linked vesting condition is irrelevant? the answer to this is yes
IFRS MB: I would use words of standard " Does it mean any type of market linked vesting condition is to be ignored?" yes
Participant: It should have been deducted for goodwill calc as well
IFRS MB: query is unclear
Participant: Reval gain is deducted from other components of equity
Participant: Sir in case share price should be 10 on vesting date, estimated status on vestind date is provided which is less than 10, thus being market linked estimate we should ignore it
Participant: OCE at acquisition date was also made of reval gain only
Participant: Why the all amount was not eliminated while calculating net assets on acquistion
IFRS MB: pl call
IFRS MB: Ignore it
Participant: K sir thanks
Participant: DeceIFRS MBer 2011 theory defined benefits Q no 3a it is written in answer there are 2 methods for accounting of acturial gain or loss either recognise them fully in income statement or oci. I think the amount arrived remeasurment is acturial gain or ltoss which we transfer into oci, but as per theory provide we can transfer it to income statement also
Participant: Are which 2 mthods tl
Participant: Sir Dec 2011 q no 3b in answer 150 I arrived as excess recognised through corridor limit, why it is so and how. Further for sofp when both benefit and asset provided at end of year net to be taken adjusting any unadjuseted acturial loss but in answer to this qn current charge t 2600 ( wn 1) is altready deducted whilte arriving at net obltigtation at end then why againt dedcuted to arrittve at SOP figure
IFRS MB: Dec 11 is solved as per old provisions of its 19. In tabulation topicwise it is yellow marked "not to solve"
IFRS MB: Ias 19r is remeasurement and to oci only
IFRS MB: Pl don't waste time on corridor
Participant: Sir in qustions information about life is given like in Dec 2011 we should ignore it
Participant: Further sir in its answer current acturial loss is also deducted along with unrecogised loss, where is current acturial lossa must have Been deducted while arriving at closing of net asset and liab to be shown sofp. However both is deducted and only balance is shown. I think onlt unrecognized actutial loss only to be deducted or in new 19r we should igonre any unrecognized act loss
IFRS MB: In 19r there is no unrecognised loss at all
IFRS MB: Pl forget Ias 19 even for comparison
Participant: K sir thanks
Participant: Sir in Dec @2009 answer 1 of soci change in fv of def n cont cons payable change is taken in income however in recording it is said if there is any changes before 1 year or on or before report date investment to be adjusted not to take in income
Participant: Further in thuoe same
Participant: Further in answer too same qn full legal and professional cost 1000 is charged to investment cost of soci however out of this 600 is related to cost of issue which should be debited to share prem or other equity element. but no ratification is done is answer
IFRS MB: Dec 09 1 year but provided situation exist on acquisition date. Here it is due to subsequent events.
IFRS MB: Regards 600 to share premium the question does not ask balancesheet so not visible.
Participant: in jun 2009 q5 b stage of completion
Participant: why you considerd the progress payment received from customet in spite of the sofp for the year ended 31 march 2009 and the payment on
Participant: the billing on 30 april 2009
IFRS MB: That is mistake by acca
Participant: Related to IAS 16
Participant: Examples of directly attributable costs include cost of employees salary n wages n other benefits
Participant: Whose salary are we considering here?
IFRS MB: Normally in a self- constructed asset own workers building a property. Direct labour
IFRS MB: See june 10 q 5 a type
Participant: Ok thank you Sir
Participant: Sir need to ask in regard to financial liabilities as per ias 39 all fv changes to be recognised in soci however as per ifrs 9 change in fv attributable to changes in credit risk of liability presented in oci remaining amount of change in soci. Since ifrs 9 to be applicable from jan 2015 how to solve in exam as per ias 39 or ifrs 9
Participant: Further page no 8, last line of ifrs 9 notes from where from where 12,00,000 arrived and
Participant: Why it is deducted to arrive at carrying value of liability
IFRS MB: Financial liability as per ifrs 9 is in syllabus but they will mention in question
IFRS MB: Generally all financial liabilities will be at amortised cost. So only in specific cases financial liability may need treatment under fv
IFRS MB: In short solve as per ifrs 9
IFRS MB: About page 8 will go thru and revert
Participant: Ok sir, thanks
Participant: Sir
Participant: For revenue recognition if expenses is measurable for warranty
Participant: Along with deferred revenue we need to create provision as well correct?
IFRS MB: Initial warranty make provision but no deferring revenue
Participant: Dear sir in dec 2013 answer fv of hedge 1.1 mns is credited in oci since it is financial asset as provided in question, however it should have been debited to some asset also which i am not able to find.
Participant: Good morning sir
Participant: Sorry couldn't reply as I was in office n couldn't refer to d sum
Participant: If u see d problem deferred revenue is accounted for d warranty part
Participant: <Media omitted>
Participant: This warranty was a part of the contract
Participant: Cost is also measurable
IFRS MB: Rohit can you please recheck. In current assets I can see financial assets derivative 1100
IFRS MB: I think we need to change the word warranty in title of question. We will make that correction.
IFRS MB: The example is on after sale service. So the question and answer is correct
Participant: Sir
Participant: Difference between after sales service n warranty?
Participant: Both r obligation
Participant: Has revenue element n measurable cost
IFRS MB: After sale service and/or annual maintenance etc are services after sale
IFRS MB: Warranty is normally supposed to be for any manufacturing defect
IFRS MB: People loosely use it same.
IFRS MB: Warranty generally should be for 6 months or one year or such shorter periods
Participant: Sir in this sum the term is after sales service is for any defects that became apparent in d products for one year
Participant: So isn't it warranty?
IFRS MB: Yes agree. But normally they refer to other than manufacturing defects. In such only parts are repaired
Participant: Tricky
IFRS MB: Warranty even signifies return of product and basic manufacturing defect leading to product almost not working
IFRS MB: Warranty is generally a customer confidence giving statement
Participant: Sir for either of them if cost is measurable n revenue to be earned
IFRS MB: Yes it is tricky and gap is narrow
Participant: We will take the revenue as deferred revenue
Participant: N provision for the cost?
IFRS MB: Generally on initial warranty there should not be separate revenue element as it will be customers confidence giving statement
IFRS MB: But extended warranties create such possibility of deferred revenue
Participant: N provision for the warranty cost?
IFRS MB: If revenue element is not separate the provision for warranty cost should be booked alongwith revenue booking on same day. The cost booking should be on past estimates
Participant: Got it.. do this apply for after sales service or extended warranty?
Participant: In notes n sum warranty cost provision is mentioned for initial warranty only
IFRS MB: Mostly no. Because after sales service revenue element will be separable and available
IFRS MB: Regards extended warranty I do not expect a question as it is a diasy issue
Participant: So even V know V would need to incur cost in future for sure n V take it as deferred revenue as well V will not provide for it
Participant: N book actual cost as n when incurred
IFRS MB: Yes if they show separable element take deferred revenue
IFRS MB: And book cost also over the period
Participant: As n when service availed
Participant: Actual cost
IFRS MB: Period based provision
Participant: So V create provision?
Participant: It's not mentioned in notes.. only deferred revenue is mentioned for extended warranty
IFRS MB: Pl call
IFRS MB: Or should I call
Participant: Thank you Sir
Participant: Sir in dec 2012 answer 3 b ii imputed rate of interest is 15% for 18 months and contract is for 24 months then also why revenue is discounted by 1.15 what for rest 6 month discounting
IFRS MB: Because contract is 2 years and first bill raised after 6 months. Also that is reporting date. Also such discounting effect make sense only on reporting dates
Participant: K sir thanks
Participant: Gd mng sir
Participant: Sir in june 2012 sofp question note 7 employee benefits. 2nd last line of note in qn actuarial gain or losses recognised in OCI when arise. The total increase in liability is 31000 out of it 1000 is due to actuarial loss. It mean 30000 debit should be in RE and 1000 in OCI but in answer complete 31000 is debited to RE. Why sir
IFRS MB: It is an error in my opinion. I followed up lot with acca but no reply.
Participant: Thus 1000 should be transferred to oci
Participant: Gd mng sir
Participant: Sir in june 2012 answer calculation of retained earnings note no5 of answer. The impairment of goodwill is allocated between alpha and NCI 75:25. However since there was no goodwill before acquisition, it is generated on acquisition, the goodwill must be in the books of alpha. Thus how it can be allocated to NCI. In other questions there is no such allocation.
IFRS MB: Goodwill entry is passed in consolidation reports
IFRS MB: Not in alpha books
IFRS MB: Pl tell me in which other questions there is no allocation?
Participant: <Media omitted>
Participant: Hi Sir..IAS 33 page no 16.. While calculating dilutive EPS why Retail site contingency shares are tken as 10000. Also in basic EPS calculation these are tken as 5000 so while calculating dilutive eps for this example toal nuIFRS MBer of shares should be 1000,000+5000+900000
Participant: Hi sir in dec 2011answer for qn no 2 part iii. PPE is valued at lower of carrying value or revalued amt, however since the assets are not available for immediate sale it should not be classified as held for sale and had to be dealt normally as per ias 16 and ias 36. Thus plant is correctly impaired by 3 mns but why the property is not revalued up to 17mns ( revalued value)
Participant: From carrying value 12 mns
IFRS MB: Rohit - Ias 16 provides for cost or revaluation model as an accounting policy decision. When question does not mention anything one should presume cost method is used. So --- since property value has gone up it cannot be revalued upwards
Participant: If if we write assumption that revaluation is followed we could have used revaluation
IFRS MB: No assumption in this paper
Participant: K sir
Participant: Gd mng sir. In june 2011 qn 4 transaction 3 for construction, general allocated overheads need not to be taken in its cost. However here 1000 is added to it. Ideally It should not be added.
IFRS MB: There is a difference between allocation and absorption
Participant: K sir understood, thanks
IFRS MB: Allocation yes, absorption no. I am sure you have studied these two concepts
Participant: Yes sir need to read the question very carefully and attentively. Absorption is absorbing all the indirect cost n overheads of a cost center or dept etc on the total production of the cost center or dept. However allocation is identifying the process and allocating its total cost on the process or assignment to which it is related.
IFRS MB: 
Participant: Sir in dec 2010 consolidated sofp. There is joint control, usually in questions we see jv or significant influence and go for equity accounting. However here joint control exists and used proportionate consolidation. This qn is marked read in tabulation at present i think for joint control also we need to go for equity accounting And not by proportionate cons.
Participant: *Read is red
IFRS MB: Red mark means solved under old provisions hence do not try
IFRS MB: It is written in tabulation topicwise
Participant: K sir
Participant: Sir as provided in this question receivables are purchased by external party like 25000 receivables, cash given to entity 20000 by third party. 5000 entity charged to finance cost. There is a condition if receivables are not recovered then entity need to repay this amount in next year. In answer entry is reversed RE credited by 5000, receivables debited by 25000 and short term borrowings credited by 20000. Since on reading the qn it seems a short term fund arrangement. I think this treatment will reman same now also.
Participant: Further if there is genuine factoring of receivables with recourse. Then we need to remove the receivables by the amount factored. The cost of factoring to be taken in soci. And what about the recourse element.
IFRS MB: Anything with recourse is financing
Participant: K sir, thanks
Participant: Sir as provided in ifrs 9 equity instrument if held for trade needs to be valued at FVTPL and any gain or loss to br recognised in SOCI. And in case it is not held for trade any dividend will be taken to soci however any fair valuelessness change will be taken to oci and once sold any gain or loss will also be taken to oci and amount will be transferred from oci to equity. No transfer to p & l is allowed, since by doing this p & l get protected from any volatility. In dec 2010 qn 3 transaction c it is written that entity keeps the share for their growth potential Rather treat them as part of trading portfolio. Does it mean share are not held for trade.
Participant: In answer any fair value change is taken to oci, which seems ok. However when after some years 60% of shares are sols that much proportion is transferred to p & l from oci, however it should be transferred to equity not p & l. I am lil confused in this treatment.
IFRS MB: Ifrs 9 applicable for financial assets from June 11 exam. Show questions upto dec 10 should not be referred
Participant: K sir thanks
Participant: Sir if there is some cost of issue of shares on acquisition of subsidiary. It needs to be debited to share premium or other component of equity and not to expense Is it so. Just like legal fee related to acquisition.
IFRS MB: Legal fees charge to p and l
IFRS MB: While cost of issue debited to share premium or oce
IFRS MB: So it is not just like
Participant: Sir i mean to say, if legal fee is 5 mns and 3mns related to cost of issuing shares then 3 mns to taken to oci and rest to p & l
IFRS MB: 3 mn to oce and rest to p and l
Participant: K
Participant: june 13 question 3(b) part iv..why kappa is not posted 64000 rs finance income as current assets for next 12 months...??????
IFRS MB: Gaurav - on mar 13 it is expected to be received after 12 months
Participant: Sir in the theory notes provided there is no ias or ifrs for adjusting or non adjusting event by solving vsrious questions it seems that any change in receivables are adjusting event. Is it possible to read it from somewhere.
IFRS MB: Rohit tried calling
Participant: I reached memphis. Still unpacking . May start next Monday .
Participant: Sir june 2009, socie and socie qn, note 6. Sir i am not able understand the meaning of this note it says " the divided received form gamma ( sig influence) and laIFRS MBda ( held for trade invest) during the period were credited to income statement of alpha as the post acquisition profits of gamma and laIFRS MBda were in excess of dividend received.
IFRS MB: It means it is paid out of post acquisition profit
Participant: K sir thanks
Participant: Dear dec 12 question note 1...the change in cont considearation of 2 million is not debited into investment..they reassessed the investement on 30 sept 12..the word has been used ''on " not by...pls clearify.
IFRS MB: "caused by better..... In the post acquisition period " it means situation did not exist on acquisition date. So no impact on investment. To be charged to p and l
Participant: Got it sir...thanks.
Participant: Hi Sir..what is corridor method in post employment benefits..Also is it applicable for dec 2014 exams?
IFRS MB: Not applicable. Learn to forget it
Participant: Why am I able to see ur conversation with other students
Participant: Sir..Also in dec 2011 Question3 b part..interest rate on plan asset and plan liability..revised estimates are also given at 30 th sep 2011..but in answers they took the rate on 1st oct..normally we take latest the answer given wrong?
Participant: Ok
Participant: sir in june 2012 q1 consolidated why not add 50000 share issued to acquired beta in total shar capital 195000+50000
Participant: also in other component why we didn't consider premium on issue of shares to acquire beta 50000×2.5= 125000
IFRS MB: Little busy. Give me a day please
Participant: ok sir
Participant: I think its because the shares were acquired last year and they would already be added in the share capital
Participant: Sir in june 2008 for soci profit allocation between alpha and nci. For nci share calculation goodwill impaired not reduced. It should have been reduced, in june 2009 goodwill impairment is reduced for calculation of nci profit share
IFRS MB: Ignore june 08
Participant: K sir
IFRS MB: Aarti - first of all forget dec 11 q 3 b
IFRS MB: These are marked red in tabulation topicwise and said not to solve
IFRS MB: Pl do not de-focus
IFRS MB: Also "normally we take latest estimates " is wrong statement
IFRS MB: Further opening rate is charged for unwinding always
IFRS MB: I am replying to Participant question
Participant: Ok sir..thnks..
Participant: Dear friend today i checked my admit card and it is having my photograph on it
Participant: Sir we need to write exams from black pen only. It os written in instructions
Participant: Dear sir..i have practiced 15 questions from tabulation sheet for u said for 20 questions..kindly provide few more problems for consolidation...
Participant: Dear june 12 note 7...benefit paid to plan meIFRS MBers has not been deducted..? I am unable to understand this point..pls clearify.
IFRS MB: Benefits entry is liability dr to cash (asset) cr so net asset do not change
IFRS MB: It is necessary for you to see video recording of modified june 5 q 5 wherein I have said many times that "benefits " have no impact
Participant: Ok...thanks sir.
Participant: Sir in case increase or dec due to revaluation of asset we have the option to take it in soci or oci.
IFRS MB: Read basics and try to understand step-by-step
IFRS MB: I will ask you question and you answer point by point
IFRS MB: Are you talking about tangible asset called ppe means held for use in business??
IFRS MB: Some students are still asking how to start  and plan studies. But I am always the planning is given below
IFRS MB: Do in sequence
1 solve consolidation examples june 09 to june 14 except dec 10 is 10*3 =30 hours. 2 see dec 10 all adjustments except jv consolidation 3 hours 3 study only ifrs 9 examples and for hedge ias 39 with examples 5 hours 4 classify topics in a. Most popular - share based payment, revenue recognition, restructuring under Ias 37 b. Alternatively asked - ppe/hfs, lease/construction, Eps/defined benefits c. Occasionally asked intangible assets, deferred tax 11 standards into 3 hours = 33 hours then 4 small stds a. Ias 37, Ias 8, Ias 10, Ias 2 asked alternatively for 2/4 marks 5 theory only Ias1 and ifrs 1 and related party, fair value, ifrs 10,11,13 6 decide whether to do very rarely asked agriculture once in Dec 04
Also ifrs 6 minerals never asked govt grant borrowing cost investment property each of them asked once only for 2/4 marks
So must do is 33 +5+33= 71 hours
Participant: Sir i am talking about tangibles assets there are 2 methods either to pass revaluation from p l or through oci and accumulate the amount in oci in equity. If opted for oci every year dep charged in p l need to be transferred to equity.
IFRS MB: You are confusing me.
IFRS MB: If you can answer point by point then it will be better
IFRS MB: I will ask you question and you answer point by point
IFRS MB: Are you talking about tangible asset called ppe means held for use in business??
IFRS MB: I repeat my question
Participant: Yes sir
IFRS MB: So the next question is company makes accounting policy decision whether to use cost method or revaluation method for each class of assets.
IFRS MB: What decision this company has made?
Participant: Revaluation method
IFRS MB: Is there a past negative revaluation??
IFRS MB: I mean revaluation downwards?
Participant: No sir no downward revluation
IFRS MB: Then revaluation should must be put in oci and oci onpy
Participant: Sir in case there is downward revaluation
Participant: Sir may i call u for a minute to ask clarification on this, thus to remove the confusion
Participant: Sir june 2013 a lil confusion in note 2 alpha investment in gamma. Fv is intial investment by alpha in gamma is rs 74000 it is provided in same note fv of investment in gamma on reporting date is rs 78500. Ideally if investment is not held for trade entity may adopt not to revalue the investment. Impairment to be checked, separate issue. Here in qn it is provided that alpha made an election to measure investment in gamma at fair value through oci. But in answer the revaluation os reversed so as to arrive at initial investment and profit share in beta is added to investment. Why in answer revaluation is reversed even though they have specifically mentioned about revaluation.
Participant: Further in the same qn initially present value of deff. Consideration Payable to subsidiary beta is 25000 on april 1 2012, however it changed to 28000 as on 31.03.2013 due to condition existing on acquisition date. Since both the conditions are satisfied change is with in 1 year from acquisition and due to change in circumstances existing on acquisition date still tge change is not debited to investment in answer.
IFRS MB: Para 1 looks total confusion on your part. When you write some provisions I wonder where you get those wordings. These are nowhere in ifrs
IFRS MB: First of all stop using words revaluation under financial instruments. This word is in non-monetary assets only
Participant: K. Sir in para 1 i mean to say if an equity instrument is held not for trade then it can be valued at cost as per ifrs 9.
Participant: And in answer also investment in gamma is dealt according to above said provision
Participant: However qn says alpha made an election to value investment in gamma at fair value.
Participant: Sir i have gone through the financial instruments theory again and revised the concept again. Conceptually i was wrong yesterday. Need to ask a clarification about a treatment in note 2. May i call you.
IFRS MB: What is note 2
Participant: About investment in associates june 2013
Participant: Initial investment in gamma of 74000 by alpha. Fair value of investment estimated 78500 on reporting date. As provided in question alpha opted fv through oci and according increased investment and oci in equity by 4500.
Participant: In answer to this qn the above tretment is reversed and share in associate is calculated and added to retained earning.
IFRS MB: Yes because it is associate. Hence treatment is corrected
Participant: Sir, the concept related to an investment in equity instruments not held for trading cannot be applied on this.
IFRS MB: Any equity investment first thing to check is whether it's control or significant influence or joint control. If not then residual category is ifrs 9 passive investment
IFRS MB: Then within that is initial irrevocable election as fvtoci and if not then residual is fvtpl
Participant: Ok sir, got the clarity on this concept thanks
IFRS MB: By using the words held for trading you are anyway talking of Ias 39 which is not for exams in dip ifrs
Participant: Sir couldn't understand what u said above. Ias 39 is financial instrument impairment how it is related to my query.
IFRS MB: Held for trading words are only there and not in ifrs 9 directly
Participant: Sir but in theory notes in ifrs 9 it is written on page 9, under equity instruments para, point 1. Equity instruments held for trading are to be classified as FVTPL
IFRS MB: I will recheck in this matter
Participant: Sir if a property is transferred from owners occupied property held under cost model to investment property
Participant: And revaluation method followed, then on transfer any reval gain or loss to be dealt with ias 16 on transfer.
Participant: Further once transfer is made on investment property depreciation will not be charged
Participant: Any rev gain or loss on subsequent fv measurement of investment property to be charged to soci
IFRS MB: What is the question?
Participant: Need to clear, at the time of transfer of owners occupied prop to invest property revaluation to be dealt with as per ias 16 and afterwards any revaluation on investment prop to be transferred to soci.
IFRS MB: No. ppe at cost method transferred at cost only. Initially measured at cost as investment property and on first reporting date it revalued
Participant: K sir, thanks
Participant: While preparing SOCI, in adjusting for NCI in Beta, it used to be PAT less Excess Depreciation. But from Dec 2012, the solution changed to PAT less FV Adjustment + DT on FVA. Why this change? Because to me the initial treatment was more reasonable
IFRS MB: There is no such change . pl advise names of comparative two question nuIFRS MBers and exam year month, where you feel so. This will help me to guide you better
Participant: Question of June 2008, June 2009, Dec 2009 and June 2011 deducted Extra Deprecation from PAT of Beta while computing its NCI. But when you go to Dec 2012 and June 2014, Fair Value Adjustment less Deferred Tax was added to PAT of Beta.
Participant: Sir is it possible to shoe negative figure in oce in sofp. If yes in june 2012 qn note 7 employee benefits after doing all adjustments closing net liability comes 66000 and in sofp net liab is 35000, the diff 31000 needs to be adujsted. It is mentioned in qn except contribution to plan no other entry is made in books. The break up of 31000 is current service cost 28000, interest cost 2000 to be adjusted in RE since p& l item and actuarial loss 1000 since oci needs to be shown in oce. In answer total adj of 31000 adjusted to RE.
IFRS MB: Yes negative figure is possible to show
IFRS MB: But ifrs is not very hard and fast between RE and oce items. So it is ok like
Participant: K sir thanks
Participant: Good morning Sir. Kindly compare solutions to Dec 2005 (Q3-1) and Dec 2008 (Q3A). In Dec 2005 (Q3-1) Pension Plan Payment was recognized as one of the costs directly associated with closure but in Dec 2008 (Q3A) it was ignored. Kindly clarify Sir.
IFRS MB: Use latest. Difference is thin
Participant: june 08...while calculating minority interest in beta..why impairment of goodwill of rs 1600 is not deducted ?????
Participant: Sir attaching a screen shot of theory related to fair value, got an idea by Reding it but wants to talk you for its understanding
Participant: In dec 13 goodwill on acquistion by subsidary is not considered for consolidation -note 4 last line .whether such goodwill is considrred internally generated and that y not consolidated?
Participant: Whether defreed tax assets can be current the same is treated as current in dec 13 question 3 b
IFRS MB: Net assets are reduced to goodwill comes same
IFRS MB: Goodwill has to be calculated on top level
Participant: Got it thanks
IFRS MB: Try to increase net assets by 100000
IFRS MB: We would have got negative goodwill, if we would have credited negative goodwill to p and l and shown beta goodwill in b/s
Participant: Hi case of convertible debts..if issue cost is also to deal with issue cost while computing the liability component and equity component..
IFRS MB: We spoke
Participant: In one of the conso question impairement of investment in associate is provided at conso level and shown in the line of share of profit loss from associate
Participant: Should this impairement be not treated as stanalone adjustment and shown under admin exp or cost of sales
IFRS MB: Debatable point, which was raised to acca many times. But not responded. Currently follow their practice.
June 2015 question 2A pertaining to Financial instrument, Sir 2 queries in this question
Why $350000 taken to investment income, Cannot understand the logic
In the same question remeasurement principle of equity is given, Which states equity needs to be remeasured at each year end at fair value. Logic for the same is not understood
IFRS MB:Investment in stock option was 0.25+2.00= 2.25. This was derecognition by getting shares of fair value 2.60 so difference 0.35 is investment income. Further ifrs 9 mentions about measurement at reporting date so it is remeasured. At 2.90 - 2.60 =.0.30 is fv change
About dec 10 discounting factors for 9% are given. So we have to calculate that at 9% then 9.35% is actually eir. Hence issue cost has to be allocated in debt equity ratio post discounting.On that liability calculate 9.35% interest and then you should get liability balance mentioned by you
Participant:In case of june15 if the derecognition had not happened till March 15 what would be the scenario
IFRS MB:Stock option as a financial instruments would have been fair valued