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Acquisitions of businesses can take many forms and can have a fundamental impact on the acquirer’s operations, resources and strategies. These acquisitions are sometimes referred to as mergers or business combinations, and the accounting and disclosure requirements are set out in IFRS 3 ‘Business Combinations’.

Acquisitions of businesses can take many forms and can have a fundamental impact of the acquirer’s operations, resources and strategies. These acquisitions are described in many ways depending on the underlying facts and circumstances: mergers, takeovers and business combinations are all terms that are used, and the accounting and disclosure requirements for all of them are set out in IFRS 3 ‘Business Combinations’.

Private operating companies seeking a ‘fast track’ stock exchange listing sometimes arrange to be acquired by a smaller listed company (often described as a ‘shell’ company). This usually involves the listed shell company issuing its shares to the private company shareholders in exchange for their shares in the private operating company. A transaction in which a company with substantial operations (‘operating company’) arranges to be acquired by a listed shell company should be analysed to determine how it should be accounted for under IFRS.

With all the challenges presented by both Brexit and the coronavirus pandemic, the UK Budget announced back in Spring 2021, has received little press attention.

IAS 36 ‘Impairment of Assets’ sets out the requirements entities should follow prior to concluding if an asset should be written down in the financial statements (ie impaired). However, due to the complex nature of the standard, the requirements of IAS 36 can be challenging to apply in practice.

IAS 36 ‘Impairment of Assets’ prescribes the accounting for impairment reviews. There are some detailed requirements of IAS 36 that are complex and challenging for the preparers of financial statements to apply.

IAS 36 ‘Impairment of Assets’ provides the guidance for carrying out impairment reviews of assets (both tangible and intangible). IAS 36 is not a new Standard, and while many of its requirements have been extensively commented on, IAS 36’s guidance is detailed, prescriptive and complex in some areas, and therefore frequently challenging to apply in practice.

IAS 36 ‘Impairment of Assets’ prescribes the accounting for impairment reviews. While the guidance in this area has not changed in recent years, it still remains a challenging area to apply by preparers of financial statements.

We are supporting a number of clients across public and private sectors to navigate the challenges and opportunities that hybrid models of working can bring.

Having an abundance of cash on hand may not seem like too much of a problem for most of us, however there are potential downsides for businesses who are reporting excess cash on their balance sheets.

Even before the arrival of Covid-19, forward-thinking charitable organisations had already begun to consider how to diversify their income streams. They were looking to step away from traditional fundraising methods, as the early warning signs indicated a waning public appetite for direct debits and voluntary donations

Granting lease incentives is a common way to encourage a new lessee to sign up to a new lease contract and fill vacant premises. When accounting for lease incentives in accordance with IFRS 16 ‘Leases’ from a lessee perspective, questions may arise in how to identify a lease incentive and when the accounting treatment changes depending on how the lease incentive is granted.

Under IFRS 16 ‘Leases’, discount rates are used to determine the present value of the lease payments used to measure a lessee’s lease liability.

Read our latest update IFRS update

The International Accounting Standards Board (IASB) has published ‘Plan Amendment, Curtailment or Settlement (Amendments to IAS 19)’. The amendments require companies to use updated actuarial assumptions to determine pension expenses following changes to a defined benefit pension plan.

HMRC has published a change of policy in relation to the place of supply of delivered goods to consumers located in other Member States. Currently, under the UK’s place of supply rules VAT is due in the Member State of delivery if the supplier supplies and delivers the goods to the customer. This rule means that many suppliers are obliged to register for VAT in each Member State where they deliver goods to customers.