A Futures Contract is a legally binding AGREEMENT between two parties to buy or sell a specific asset or commodity at a predetermined price and date in the future. They are TRADED on an exchange, and provide an efficient way for producers and consumers to Manage the Risks associated with … Read More
Contract Costs relate directly to a contract, generate or enhance resources that will be used to fulfill the contract, and be expected to be recovered through the contract’s revenue. Additionally, these costs are INCREMENTAL to obtaining the contract, meaning that they would not have been incurred if the contract had … Read More
Provision in Accounting as per IAS 37 represent a company’s estimated liabilities or obligations, which are RECOGNIZED in financial statements as an expense or loss. Provisions are typically CREATED when there is uncertainty about the amount or timing of a liability, but the company has a legal or constructive obligation … Read More
Contingent Liabilities are potential OBLIGATIONS that may or may not come into existence, depending on the occurrence or non-occurrence of one or more future events that are not entirely within the control of the entity. They are often referred to as “Off-Balance Sheet” items because they are not reflected in … Read More
A Contingent Asset is a potential asset that may only be REALIZED if a certain condition is met. i.e, it is an asset that only has VALUE if a specific event occurs. This event can be internal to a company or external, such as changes in market conditions. Contingent Asset … Read More
IFRS 9 INTRODUCED the concept of Fair Value through Profit or Loss (FVPL). This classification APPLIES to financial instruments that are held for trading purposes and those that are designated at fair value through profit or loss. FVPL (Fair Value through Profit or Loss) IFRS 9, is an International Financial … Read More
IFRS 9 EXPLAINS the concept of FVOCI and its SIGNIFICANCE and requires to RECOGNIZE changes in Fair Value through Other Comprehensive Income rather than in Profit or Loss (P&L). FVOCI (Fair Value through Other Comprehensive Income) International Financial Reporting Standard (IFRS 9) ISSUED by the International Accounting Standards Board (IASB) … Read More
Lease Reassessment IFRS 16 is a process that REQUIRES lessees to evaluate their leases and make any necessary adjustments to ensure that the leases are being reported ACCURATELY and in compliance with IFRS 16 (Leases). This involves a REVIEW of the lease terms, including the lease term, lease payments, and … Read More
Lease Modification, as per IFRS 16 refers to CHANGES made to the terms and conditions of a lease contract after its inception. These changes can result from negotiations between the LESSOR and the LESSEE or due to changes in laws and regulations. For example, lease modifications include changes in lease … Read More
Revenue from Contracts with Customers, PRESENTED the concept of Contract Modification IFRS 15 and further outlined how entities should recognize and report revenue from customer contracts. What is Contract Modification IFRS 15? A Contract Modification occurs when the terms of a contract are changed, either through an agreement between the … Read More