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ANNUAL REPORTING

Knowledge base for IFRS Reporting



Menu
 * IFRS Topics A – Z
 * IFRS in short
   * IFRS 2 Share-based payments
   * IFRS 3 Business Combinations
   * IFRS 4 Insurance contracts
   * IFRS 5 Non-current assets Held for Sale and Discontinued Operations
   * IFRS 6 Exploration for and Evaluation of Mineral Resources
   * IFRS 7 Financial instruments – Disclosures
   * IFRS 8 Operating Segments
   * IFRS 9 Financial instruments
   * IFRS 9 Hedge accounting
   * IFRS 10 Consolidated Financial Statements
   * IFRS 11 Joint Arrangements
   * IFRS 12 Disclosure of Interest in Other Entities
   * IFRS 13 Fair value measurement
   * IFRS 15 Revenue from Contracts with Customers
   * IAS 2 Inventories
   * IAS 8 Accounting policies estimates and errors
   * IAS 10 Events after the Reporting period
   * IAS 16 Property, plant and equipment
   * IAS 23 Borrowing costs
   * IAS 24 Related party disclosures
 * IFRS vs US GAAP
   * IFRS vs US GAAP Financial Statement presentation
   * IFRS vs US GAAP Revenue recognition
   * IFRS vs US GAAP Intangible assets goodwill
   * IFRS vs US GAAP Financial assets
     * IFRS vs US GAAP Nonfinancial assets
     * IFRS vs US GAAP Investment property
     * IFRS vs US GAAP Impairment
     * IFRS vs US GAAP Financial liabilities and equity
     * IFRS vs US GAAP Nonfinancial liabilities
   * IFRS vs US GAAP Derivatives and hedging
   * IFRS vs US GAAP Business combinations
   * IFRS vs US GAAP Taxation
   * IFRS vs US GAAP Share-based payments
 * The IFRS Standards
 * The IFRS Definitions
 * The IFRS Jargon

Menu
 * IFRS Topics A – Z
 * IFRS in short
   * IFRS 2 Share-based payments
   * IFRS 3 Business Combinations
   * IFRS 4 Insurance contracts
   * IFRS 5 Non-current assets Held for Sale and Discontinued Operations
   * IFRS 6 Exploration for and Evaluation of Mineral Resources
   * IFRS 7 Financial instruments – Disclosures
   * IFRS 8 Operating Segments
   * IFRS 9 Financial instruments
   * IFRS 9 Hedge accounting
   * IFRS 10 Consolidated Financial Statements
   * IFRS 11 Joint Arrangements
   * IFRS 12 Disclosure of Interest in Other Entities
   * IFRS 13 Fair value measurement
   * IFRS 15 Revenue from Contracts with Customers
   * IAS 2 Inventories
   * IAS 8 Accounting policies estimates and errors
   * IAS 10 Events after the Reporting period
   * IAS 16 Property, plant and equipment
   * IAS 23 Borrowing costs
   * IAS 24 Related party disclosures
 * IFRS vs US GAAP
   * IFRS vs US GAAP Financial Statement presentation
   * IFRS vs US GAAP Revenue recognition
   * IFRS vs US GAAP Intangible assets goodwill
   * IFRS vs US GAAP Financial assets
     * IFRS vs US GAAP Nonfinancial assets
     * IFRS vs US GAAP Investment property
     * IFRS vs US GAAP Impairment
     * IFRS vs US GAAP Financial liabilities and equity
     * IFRS vs US GAAP Nonfinancial liabilities
   * IFRS vs US GAAP Derivatives and hedging
   * IFRS vs US GAAP Business combinations
   * IFRS vs US GAAP Taxation
   * IFRS vs US GAAP Share-based payments
 * The IFRS Standards
 * The IFRS Definitions
 * The IFRS Jargon


IFRS 15 RETAIL – THE FINEST PERFECT EXAMPLES

18/04/202312/04/2023 by 75385885


IFRS 15 RETAIL REVENUE – FINEST PERFECT EXAMPLES

Retail is the process of selling consumer goods or services to customers through
multiple channels of distribution to earn a profit. Retailers satisfy demand
identified through a supply chain. The term “retailer” is typically applied
where a service provider fills the small orders of many individuals, who are
end-users, rather than large orders of a small number of wholesale, corporate or
government clientele. (Source: Wikipedia)

So what is the IFRS 15 guidance for retail?

Here are the cases covering the most significant accounting topics for retail in
IFRS 15.

--------------------------------------------------------------------------------


CASE – CUSTOMER INCENTIVES BUY THREE, GET COUPON FOR ONE FREE

Death By Chocolate Ltd, a high street chain, is offering a promotion whereby a
customer who purchases three boxes of chocolates at €20 per box in a single
transaction in a store receives an offer for one free box of chocolates if the
customer fills out a request form and mails it to them before a set expiration
date.

Death By Chocolate estimates, based on recent experience with similar
promotions, that 80% of the customers will complete the mail in rebate required
to receive the free box of chocolates.

How is a ‘buy three, get one free’ transaction accounted for and presented by
Death By Chocolate?

The rules

IFRS 15.22 states: “At contract inception, an entity shall assess the goods or
services promised in a contract with a customer and shall identify as a
performance obligation each promise to transfer to the customer either:

 1. a good or service (or a bundle of goods or services) that is distinct; or
 2. a series of distinct goods or services that are substantially the same and
    that have the same pattern of transfer to the customer (see paragraph 23).”

IFRS 15.26 provides examples of distinct goods and services, including “granting
options to purchase additional goods or services (when those options provide a
customer with a material right, as described in paragraphs B39-B43)”.

IFRS 15.B40: “If , in a contract, an entity grants a customer the option to
acquire additional goods or services, that option gives rise to a performance
obligation in the contract only if the option provides a material right to the
customer that it would not receive without entering into that contract (for
example, a discount that is incremental to the range of discounts typically
given for those goods or services to that class of customer in that geographical
area or market).

Read more

Categories IFRS 15 Revenue from customer contracts Tags Additional goods or
services, Allocation of the transaction price, Bill-and-hold arrangements,
Bonus, Carrying amount, contract with a customer, Contractual rights, Control,
Coupons, Credits, Direct the use, Discounts, Distinct goods, Distinct goods or
services, enforceable, Enforceable rights, Enforceable rights and obligations,
Goods and services, Highly probable, Incentives, Inventory, Loyalty programs,
Measurement, Most likely amount, Options to purchase additional goods,
Penalties, Performance bonuses, Performance obligation, Performance obligations,
Price concessions, Probability, Promised goods or services, Rebates, Refund
liability, Refunds, Relative stand-alone selling price, Retailers, Revenue,
Revenue recognition, Same pattern of transfer, Separate performance obligations,
Series of distinct goods, Stand-alone selling price, Stand-alone selling prices,
Transaction price, Two performance obligations, Variable consideration Leave a
comment


IFRS 15 REAL ESTATE REVENUE COMPLETE AND ACCURATE RECOGNITION

12/04/2023 by 75385885


IFRS 15 REAL ESTATE

Under IFRS 15 real estate entities recognize revenue over the construction
period if certain conditions are met.


KEY POINTS

 * An entity must judge whether the different elements of a contract can be
   separated from each other based on the distinct criteria. A more complex
   judgment exists for real estate developers that provide services or deliver
   common properties or amenities in addition to the property being sold.
 * Contract modifications are common in the real estate development industry.
   Contract modifications might need to be accounted for as a new contract, or
   combined and accounted for together with an existing contract.
 * Real estate managers may structure their arrangements such that services and
   fees are in different contracts. These contracts may meet the requirements to
   be accounted for as a combined contract when applying IFRS 15.
 * Real estate management entities are often entitled to several different fees.
   IFRS 15 will require a manager to consider whether the services should be
   viewed as a single performance obligation, or whether some of these services
   are ‘distinct’ and should therefore be treated as separate performance
   obligations.
 * Variable consideration for entities in the real estate industry may come in
   the form of claims, awards and incentive payments, discounts, rebates,
   refunds, credits, price concessions, performance bonuses, penalties or other
   similar items.
 * Real estate developers will need to consider whether they meet any of the
   three criteria necessary for recognition of revenue over time.


IFRS 15 CORE PRINCIPLE

The core principle of IFRS 15 is that revenue reflects the transfer of promised
goods or services to customers in an amount that reflects the consideration to
which the entity expects to be entitled in exchange for those goods or services.

Read more

Categories IFRS 15 Revenue from customer contracts Tags Accurate, Alternative
use, Bonus, Cash received, Change in the scope, Construction of a building,
Contingent consideration, Contract modification, Contract modifications,
contract with a customer, Contractual terms, Control, Create an asset, Credits,
Default, Determine the transaction price, Discounts, Distinct good, Distinct
good or service, Distinct goods, Distinct goods or services, Distinct
performance obligations, Duration of the contract, Goods and services, Highly
probable, Identified performance obligations, Identify the contract, Identify
the performance obligations, Incentives, Input methods, Interest rates,
Inventory, Investments, Legal title, Legal title to the asset, Managers, Measure
progress, Measurement, Measurement period, Most likely amount, multiple
performance obligations, No revenue, Non-cash consideration, One performance
obligation, Output methods, Payment Terms, Penalties, Performance bonuses,
Performance obligation, Performance obligations, Performance obligations
satisfied over time, Practical expedient, Price concessions, Probability,
Promised goods or services, Property, Prospective adjustment, Rebates, Recognise
revenue over time, Recognition of revenue, Refunds, Revenue, Revenue over time,
Revenue recognition, Right to payment, Risks and rewards, Risks and rewards of
ownership, Same pattern of transfer, Separate performance obligations, Series of
distinct goods, Significant financing component, Significant risks and rewards
of ownership, Significantly modify, Similar types of contracts, Single
performance obligation, Stand-alone selling price, Stand-alone selling prices,
Time value of money, Transaction price, Transfer of goods, Variable
consideration Leave a comment


EBITDA – 1 BEST COMPLETE READ

12/04/2023 by 75385885


EBITDA – EARNINGS BEFORE INTEREST TAXES DEPRECIATION AND AMORTISATION

– is a measure of a company’s overall financial performance and is used as an
alternative to simple earnings or net income in some circumstances. Earnings
before interest, taxes, depreciation and amortisation, however, can be
misleading because it strips out the cost of capital investments like property,
plant, and equipment.

This metric also excludes expenses associated with debt by adding back interest
expense and taxes to earnings. Nonetheless, it is a more precise measure of
corporate performance since it is able to show earnings before the influence of
accounting and financial deductions.

Simply put, Earnings before interest, taxes, depreciation and amortisation is a
measure of profitability. While there is no legal requirement for companies to
disclose their EBITDA (here also written as EBIT-DA), according to the U.S.
generally accepted accounting principles (US GAAP) or International Financial
Reporting Standards (IFRS), it can be worked out and reported using information
found in a company’s financial statements.

The earnings, tax, and interest figures are found on the income statement, while
the depreciation and amortisation figures are normally found in the notes to
operating profit or on the cash flow statement. The usual shortcut to calculate
EBITDA is to start with operating profit, also called earnings before interest
and tax (EBIT) and then add back depreciation and amortisation.

https://www.merriam-webster.com/dictionary/EBITDA


ORIGINS OF EBITDA

Read more

Categories IFRS 13 Fair value measurement Tags Accounting policies, and
equipment, Capital investments, Cash flow statement, Comparable, Comparable
company valuation multiples, Depreciation policy, Equity, Fair value
measurement, Financial performance, GAAP, Growth, Income statement, Interest
expense, Investments, Market participants, Measurement, Notes, plant, Property,
Unobservable inputs Leave a comment


IFRS 2022 UPDATE – IAS 8 DEFINITION OF ACCOUNTING ESTIMATES – YOUR BEST READ

26/03/2023 by 75385885


IFRS 2022 UPDATE – IAS 8 DEFINITION OF ACCOUNTING ESTIMATES

Effective for annual periods beginning on or after 1 January 2023.

On 12 February 2021, the International Accounting Standards Board (the IASB or
the Board) issued amendments to IAS 8 Accounting Policies, Changes to Accounting
Estimates and Errors, in which it introduces a new definition of ‘accounting
estimates’. The amendments are designed to clarify the distinction between
changes in accounting estimates and changes in accounting policies and the
correction of errors.


DEFINITION OF AN ACCOUNTING ESTIMATE

The current version of IAS 8 does not provide a definition of accounting
estimates. Accounting policies, however, are defined. Furthermore, the standard
defines the concept of a “change in accounting estimates”. A mixture of a
definition of one item with a definition of changes in another has resulted in
difficulty in drawing the distinction between accounting policies and accounting
estimates in many instances. In the amended standard, accounting estimates are
now defined as, “monetary amounts in financial statements that are subject to
measurement uncertainty”.

Read more

Categories IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors
Tags Accounting estimates, Changes in accounting estimates Leave a comment


IFRS 2022 UPDATE – IFRS 16 LEASE LIABILITY IN A SALE AND LEASEBACK – BEST READ

18/03/2023 by 75385885


IFRS 2022 UPDATE – IFRS 16 LEASE LIABILITY IN A SALE AND LEASEBACK

Effective for annual periods beginning on or after 1 January 2024.


KEY REQUIREMENTS

On 22 September 2022, the International Accounting Standards Board (the IASB or
Board) issued Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)
(the amendment). The amendment to IFRS 16 Leases specifies the requirements that
a seller-lessee uses in measuring the lease liability arising in a sale and
leaseback transaction, to ensure the seller-lessee does not recognise any amount
of the gain or loss that relates to the right of use it retains.

A sale and leaseback transaction involves the transfer of an asset by an entity
(the seller-lessee) to another entity (the buyer-lessor) and the leaseback of
the same asset by the seller-lessee.



The amendment is intended to improve the requirements for sale and leaseback
transactions in IFRS 16. It does not change the accounting for leases unrelated
to sale and leaseback transactions.


BACKGROUND

In a sale and leaseback transaction, the seller-lessee assesses whether the
transfer of the asset satisfies the requirements in IFRS 15 Revenue from
Contracts with Customers to be accounted for as a sale. If it is accounted for
as a sale, paragraph 100(a) of IFRS 16 requires the seller-lessee to measure the
right-of-use asset arising from the leaseback at the proportion of the previous
carrying amount of the asset that relates to the right of use retained by the
seller-lessee.

However, IFRS 16 did not specify the measurement of the liability that arises in
a sale and leaseback transaction. This has been addressed in the amendment.


AMENDMENT TO IFRS 16

After the commencement date in a sale and leaseback transaction, the
seller-lessee applies paragraphs 29 to 35 of IFRS 16 to the right-of-use asset
arising from the leaseback and paragraphs 36 to 46 of IFRS 16 to the lease
liability arising from the leaseback. In applying paragraphs 36 to 46, the
seller-lessee determines ‘lease payments’ or ‘revised lease payments’ in such a
way that the seller-lessee would not recognise any amount of the gain or loss
that relates to the right of use retained by the seller-lessee. Applying these
requirements does not prevent the seller-lessee from recognising, in profit or
loss, any gain or loss relating to the partial or full termination of a lease,
as required by paragraph 46(a) of IFRS 16.

Read more

Categories IFRS 16 Leases Tags Accounting estimates, Accounting policies,
Carrying amount, Changes in accounting estimates, Lease liability, Lease
payments, Lessee, Liabilities, Measurement, Reliable, Revenue, Right-of-use
asset, Sale and leaseback, Sale and leaseback transactions, Termination Leave a
comment


IFRS 2022 UPDATE – CLASSIFICATION OF NON-CURRENT LIABILITIES WITH COVENANTS –
BEST READ

18/03/202317/12/2022 by 75385885


OVERVIEW – IFRS 2022 UPDATE – CLASSIFICATION OF NON-CURRENT LIABILITIES WITH
COVENANTS

In October 2022, the IASB issued amendments that clarify that only covenants
with which an entity must comply on or before the reporting date will affect a
liability’s classification as current or non-current. IFRS 2022 update –
Classification of non-current liabilities with covenants



Additional disclosures are required for non-current liabilities arising from
loan arrangements that are subject to covenants to be complied with within
twelve months after the reporting period.

The amendments will be effective for annual reporting periods beginning on or
after 1 January 2024, with early application permitted. IFRS 2022 update –
Classification of non-current liabilities with covenants


WHY THIS CHANGE?

In January 2020, the IASB issued amendments to paragraphs 69 to 76 of IAS 1 (the
2020 amendments) to specify the requirements for classifying liabilities as
current or non-current. A key requirement of the 2020 amendments was that
entities with liabilities that are subject to covenants to be complied with at a
date subsequent to the reporting period (“future covenants”) do not have the
right to defer settlement of the liabilities at the end of the reporting period
if they do not comply with the covenants at that date. IFRS 2022 update –
Classification of non-current liabilities with covenants

Stakeholders were concerned about the impact of this proposal and, as a result,
the IFRS Interpretations Committee (the Committee) published a tentative agenda
decision (TAD) in December 2020 explaining how to apply the proposal to three
fact patterns. The Committee agreed with the concerns raised in comment letters
responding to the TAD about the consequences of the 2020 amendments for certain
scenarios and reported them to the Board. On that basis, the Board proposed
amendments in November 2021, which, after further adjustments, resulted in the
amendments issued in October 2022 (the 2022 amendments). IFRS 2022 update –
Classification of non-current liabilities with covenants

Read more

Categories IAS 1 Presentation of Financial Statements Tags Accounting estimates,
Accounting policies, Bond, Carrying amount, Changes in accounting estimates,
Compliance, Convertible debt, Current liabilities, Equity, Equity instrument,
Equity instruments, Financial liability, Liabilities, Notes, Ordinary shares,
Outflow of resources Leave a comment


IFRS 9 BEST LONG-READ SPPI TEST

10/05/202201/04/2021 by 75385885


THE SPPI TEST

If an asset is in a hold-to-collect or hold-to-collect or sell business model,
an entity assesses whether the cash flows from the financial asset meet the
‘solely payments of principal and interest’ (SPPI Test) benchmark – i.e. whether
the contractual terms of the financial asset give rise, on specified dates, to
cash flows that are solely payments of principal and interest.

 * ‘Principal’ is the fair value of the financial asset on initial recognition.
   The principal may change over time – e.g. if there are repayments of
   principal.
 * ‘Interest’ is consideration for the time value of money and credit risk.
   Interest can also include consideration for other basic lending risks and
   costs, and a profit margin.

A financial asset that does not meet the SPPI Test is always measured at FVPL,
unless it is a non-trading equity instrument and the entity makes an irrevocable
election to measure it at FVOCI. Here is the decision tree to put the narrative
in context:



Contractual cash flows that meet the SPPI Test are consistent with a basic
lending arrangement in the banking industry.

Read more

Categories IFRS 9 Financial instruments Tags SPPI Test Leave a comment


LOW CREDIT RISK OPERATIONAL SIMPLIFICATION

10/05/202220/03/2021 by 75385885

Low credit risk operational simplification

IFRS 9 contains an important simplification that, if a financial instrument has
low credit risk, then an entity is allowed to assume at the reporting date that
no significant increases in credit risk have occurred. The low credit risk
concept was intended, by the IASB, to provide relief for entities from tracking
changes in the credit risk of high quality financial instruments. Therefore,
this simplification is only optional and the low credit risk simplification can
be elected on an instrument-by-instrument basis.

This is a change from the 2013 ED, in which a low risk exposure was deemed not
to have suffered significant deterioration in credit risk. The amendment to make
the simplification optional was made in response to requests from constituents,
including regulators. It is expected that the Basel Committee SCRAVL
consultation document will propose that sophisticated banks should only use this
simplification rarely for their loan portfolios.



For low risk instruments, the entity would recognise an allowance based on
12-month ECLs. However, if a financial instrument is not considered to have low
credit risk at the reporting date, it does not follow that the entity is
required to recognise lifetime ECLs. In such instances, the entity has to assess
whether there has been a significant increase in credit risk since initial
recognition that requires the recognition of lifetime ECLs.

The standard states that a financial instrument is considered to have low credit
risk if: [IFRS 9.B5.22]

 * The financial instrument has a low risk of default
 * The borrower has a strong capacity to meet its contractual cash flow
   obligations in the near term
 * Adverse changes in economic and business conditions in the longer term may,
   but will not necessarily, reduce the ability of the borrower to fulfil its
   contractual cash flow obligations Low credit risk operational simplification

A financial instrument is not considered to have low credit risk simply because
it has a low risk of loss (e.g., for a collateralised loan, if the value of the
collateral is more than the amount lent (see collateral) or it has lower risk of
default compared with the entity’s other financial instruments or relative to
the credit risk of the jurisdiction within which the entity operates.

Read more

Categories IFRS 9 Financial instruments Tags Benchmark interest, Bond,
Collateral, Commitments, Comparable, Contractual cash flow, Credit default swap,
Credit risk, Debt instruments, Debt securities, Default, ECL, Forward-looking
information, Impairment, Interest rates, Investments, Lifetime Expected Credit
Losses, Loss allowance, Loss given default, Market participants, Operating cash
flows, Probability, Probability of default, Regulators, Risk of a default,
Security, Significant Increases in Credit Risk, Supportable information, SWAP,
Timely Leave a comment


PAYMENT HOLIDAYS ON LOANS

04/05/202204/10/2021 by 75385885


PAYMENT HOLIDAYS ON LOANS UNDER IFRS 9

Governments and banks have introduced payment deferral programs to support
borrowers affected by Covid-19. But deferred payments are not forgiven and must
be repaid in the future, raising prospective risks to the banking system. Thus,
they should be designed to balance near-term economic relief benefits with
longer-term financial stability considerations.

The Basel Committee on Banking Supervision (BCBS) and several prudential
authorities have issued statements clarifying how payment deferrals should be
considered in assessing credit risk under applicable accounting frameworks.
These measures aim to encourage banks to continue lending, to avert an even
deeper recession.

Prudential authorities are caught “between a rock and a hard place” as they
encourage banks – through various relief measures – to provide credit to
solvent, but cash-strapped borrowers, while keeping in mind the longer-term
implications of these measures for the health of banks and national banking
systems.

In navigating these tensions, banks and supervisors face a daunting task as
borrowers that may be granted payment holidays have varying risk profiles.
Distinguishing between illiquid and insolvent borrowers – amidst an uncertain
outlook – should help guide banks’ efforts to support viable borrowers, while
preserving the integrity of their reported financial metrics.


WHAT IS THIS ALL ABOUT?

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Categories IFRS 9 Financial instruments Tags ECL Leave a comment


IFRS 16 LEASES PRESENTATION IN CASH FLOWS – COMPLETE EASY READ

25/03/2022 by 75385885


IFRS 16 LEASES PRESENTATION IN CASH FLOWS

Most changes from IAS 17/IFRIC 4 to IFRS 16 relate to lessees, the companies
renting a car, office or warehouse.

At first, IFRS 16 has affected balance sheet and balance sheet-related ratios
such as the debt/equity ratio. Aside from this, IFRS 16 also influenced the
income statement, because an entity now has to recognise interest expense on the
lease liability (obligation to make lease payments) and depreciation on the
‘right-of-use’ asset (that is, the asset that reflects the right to use the
leased asset).



Due to this, for lease contracts previously classified as operating leases the
total amount of expenses at the beginning of the lease period will be higher
than under IAS 17. Another consequence of the changes in presentation is that
EBIT and EBITDA will be higher for companies that have material operating
leases.

IFRS 16 also changes the cash flow statement. Lease payments that relate to
contracts that have previously been classified as operating leases are no longer
presented as operating cash flows in full. Only the part of the lease payments
that reflects interest on the lease liability can be presented as an operating
cash flow (depending on the entity’s accounting policy regarding interest
payments).

Cash payments for the principal portion of the lease liability are classified
within financing activities. Payments for short-term leases, leases of low-value
assets and variable lease payments not included in the measurement of the lease
liability remain presented within operating activities.

Presentation and disclosures

In the statement of cash flows, lease payments are classified consistently with
payments on other financial liabilities:

 * The part of the lease payment that represents cash payments for the principal
   portion of the lease liability is presented as a cash flow resulting from
   financing activities.
 * The part of the lease payment that represents interest portion of the lease
   liability is presented either as an operating cash flow or a cash flow
   resulting from financing activities (in accordance with the entity’s
   accounting policy regarding the presentation of interest payments).
 * Payments on short-term leases, for leases of low-value assets and variable
   lease payments not included in the measurement of the lease liability are
   presented as an operating cash flow.

A simple example to classify the movements in Right-of-use assets is as follows:



A simple example to classify the movements in Lease liabilities is as follows:



On the balance sheet, the right-of-use asset can be presented either separately
or in the same line item in which the underlying asset would be presented. The
lease liability can be presented either as a separate line item or together with
other financial liabilities. If the right-of-use asset and the lease liability
are not presented as separate line items, an entity discloses in the notes the
carrying amount of those items and the line item in which they are included.

In the statement of profit or loss and other comprehensive income, the
depreciation charge of the right-of-use asset is presented in the same line
item/items in which similar expenses (such as depreciation of property, plant
and equipment) are shown. The interest expense on the lease liability is
presented as part of finance costs. However, the amount of interest expense on
lease liabilities has to be disclosed in the notes.

IFRS 16 Leases presentation in cash flows IFRS 16 Leases presentation in cash
flows IFRS 16 Leases presentation in cash flows IFRS 16 Leases presentation in
cash flows IFRS 16 Leases presentation in cash flows IFRS 16 Leases presentation
in cash flows IFRS 16 Leases presentation in cash flows IFRS 16 Leases
presentation in cash flows IFRS 16 Leases presentation in cash flows IFRS 16
Leases presentation in cash flows IFRS 16 Leases presentation in cash flows IFRS
16 Leases presentation in cash flows



Categories IFRS 16 Leases, IAS 7 Statement of Cash Flows Tags Lease payments,
plant, Right-of-use assets Leave a comment
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