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IFRS Viewpoint Accounting for client money

Our ‘IFRS Viewpoint’ series provides insights from our global IFRS team on applying IFRS in challenging situations. Each edition will focus on an area where the Standards have proved difficult to apply or lack guidance. This edition provides guidance on client money – arrangements in which a reporting entity holds funds on behalf of clients.

What’s the issue?

If an entity holds money on behalf of clients (‘client money’):
• should the client money be recognised as an asset in the entity financial statements?
• where the client money is recognised as an asset, can it be offset against the corresponding liability to the client on the face of the statement of financial position?