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Acquisitions of businesses can take many forms and can have a fundamental impact of the acquirer’s operations, resources and strategies. These acquisitions are known as mergers or business combinations which should be accounted for using the requirements in IFRS 3 ‘Business Combinations’.

Mergers and acquisitions are becoming more and more common as entities aim to achieve their growth objectives. IFRS 3 ‘Business Combinations’ contains the requirements for these transactions, which are challenging in practice.

Business combinations are infrequent transactions that are unique for each occurrence. IFRS 3 ‘Business Combinations’ contains the requirements and despite being fairly stable in the ten years since its been released, still provides challenges when accounting for these transactions in practice.

The Foundation has acknowledged the need for global sustainability reporting standards and the role it could play in their development. The International Organisation of Securities Commissions (IOSCO) in late February 2021 said there was an urgent need for globally consistent, comparable, and reliable sustainability disclosure standards and it announced its priorities and vision for a Sustainability Standards Board (SSB) which closely align with those set out by the Foundation.

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.

On 22 December 2017, the President of the United States signed into law the ‘Tax Cuts and Jobs Act’. The Act is a sweeping reform of US taxation which is likely to have a significant impact on financial statements prepared under IFRS for entities with US operations.

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Both IAS 1 and IAS 10 suggest that a departure from the going concern basis is required when specified circumstances exist. Neither Standard however provides any details of an alternative basis of preparation and how it may differ from the going concern basis. Entities will therefore need to develop an appropriate basis of preparation. This IFRS Viewpoint addresses some of the issues that entities will face when doing so.

Assessing when one entity controls another is essential to the preparation of financial statements in accordance with IFRS. The control assessment determines which entities are consolidated in a parent’s financial statements and therefore affects a group’s reported results, cash flows and financial position – and the activities that are ‘on’ and ‘off’ the group’s balance sheet. Under IFRS, this control assessment is accounted for in accordance with IFRS 10 ‘Consolidated financial statements’.

This publication is designed to give Chief Financial Officers a high-level awareness of recent changes to International Financial Reporting Standards that will affect companies’ future financial reporting. It covers both new Standards and Interpretations that have been issued and amendments made to existing ones.

Your annual financial statements are a critical communication to your investors and other stakeholders. But how effective are they in meeting your stakeholders’ needs?

While IFRS 9’s mandatory effective date of 1 January 2018 may seem a long way off, companies really need to start evaluating the impact of the new Standard now. As well as compiling the information necessary to implement the Standard, companies will need to review loan covenants and other agreements that could be affected by the impact on reported results.

Private operating companies seeking a ‘fast track’ stock exchange listing sometimes arrange to be acquired by a smaller listed company (sometimes described as a ‘shell’ company). This usually involves the listed company issuing its shares to the private company shareholders in exchange for their shares. How should these transactions be accounted for? The IFRS Viewpoint gives you our views.

The IASB has published IFRS 16 ‘Leases’ completing its long-running project on lease accounting. This special edition of IFRS News explains the key features of the new financial reporting Standard and provides practical insights into its application and impact

Loan agreements often include covenants that, if breached by the borrower, permit the lender to demand repayment before the loan’s normal maturity date. In response to a borrower’s request, lenders may decide to voluntarily waive some or all of the rights they acquire as a result of a breach. This IFRS Viewpoint provides guidance on the classification of long-term loans payable as either current or non-current when covenants are present.