Homework

WEEK 2 CONTINUED

International Harmonization and International Financial Reporting Standards (IFRS)

To recap….

The IASC was formed in 1973 and over the next 28 years, the committee established standards

1973 – 2001 41 International Accounting Standards (IAS) were written

· 12 are either no long in effect or were replaced

· 27 standards are still in effect (see below)

In March 2001, the International Accounting Standards Committee (IASC) Foundation was formed as a not-for-profit corporation incorporated in the State of Delaware, US. The IASC Foundation is the parent entity of the International Accounting Standards Board, an independent accounting standard-setter based in London, UK. 

INTERNATIONAL ACCOUNTING STANDARDS

I originally found the list below but it is a little dated. I wanted to include it though as a reference since most of the links still work. Please see the website posted below this list in order to see an up-to-date list of not only IAS and IFRS standards but also IFRIC and SIC interpretations

· IAS 1 Presentation of Financial Statements

· IAS 2 Inventories

· IAS 7 Statement of Cash Flows

· IAS 8 Accounting Policies Changes in Accounting Estimates and Errors

· IAS 10 Events after the Reporting Period

· IAS 11 Construction Contracts

· IAS 12 Income Taxes

· IAS 16 Property Plant and Equipment

· IAS 17 Leases

· IAS 18 Revenue

· IAS 19 Employee Benefits

· IAS 20 Accounting for Government Grants and Disclosure of Government Assistance

· IAS 21 The Effects of Changes in Foreign Exchange Rates

· IAS 23 Borrowing Costs

· IAS 24 Related Party Disclosures

· IAS 26 Accounting and Reporting by Retirement Benefit plans

· IAS 27 Consolidated and Separate Financial Statements

· IAS 28 Investments in Associates and Joint Ventures

· IAS 29 Financial Reporting in Hyperinflationary Economies

· IAS 32 Financial Instruments: Presentation

· IAS 33 Earnings per share

· IAS 34 Interim Financial Reporting

· IAS 36 Impairment of Assets

· IAS 37 Provisions Contingent Liabilities and Contingent Assets

· IAS 38 Intangible Assets

· IAS 39 Financial Instruments: Recognition and Measurement

· IAS 40 Investment property

· IAS 41 Agriculture

Source: Annual Reporting Information, IFRS Standards

http://www.iasplus.com/en/standards/ias

Since 2001 the current International Accounting Standards Board (IASB) has issued 17 IFRS

1. First-time Adoption of International Financial Reporting Standards

2. Share-based Payment

3. Business Combinations

4. Insurance Contracts (to be superseded by IFRST 17 as of January 2021)

5. Non-current Assets Held for Sale and Discontinued Operations

6. Exploration for and Evaluation of Mineral Assets

7. Financial Instruments: Disclosures

8. Operating Segments

9. Financial Instruments

10. Consolidated Financial Statements

11. Joint Arrangements

12. Disclosure of Interests in Other Entities

13. Fair Value Measurement

14. Regulatory Deferral Accounts

15. Revenue from Contracts with Customers

16. Leases

17. Insurance Contracts

Source and for more information: http://www.ifrs.org/IFRSs/Pages/IFRS.aspx

In 2002 the IASB and U.S. Financial Accounting Standards Board (FASB) agreed to work together to reduce differences between IFRS and U.S. GAAP.

Types of differences between IFRS and U.S. GAAP.

A. Definition differences: Differences in definitions can occur even though concepts are similar. Definition differences can lead to differences in recognition and/or measurement.

B. Recognition differences: Differences in recognition criteria and/or guidance related to whether an item is recognized, how it is recognized, and/or when it is recognized (timing difference).

C. Measurement differences: Differences in approach for determining the amount recognized resulting from either a difference in the method required or a difference in the detailed guidance for applying a similar method.

D. Alternatives: One set of standards allows a choice between two or more alternative methods; the other set of standards requires one specific method to be used.

E. Lack of requirements or guidance: IFRS do not cover an issue addressed by U.S. GAAP and vice versa.

F. Presentation differences: Differences in the presentation of items in the financial statements.

G. Disclosure differences: Differences in information presented in the notes to financial statements related to whether a disclosure is required and/or the manner in which a disclosure is required to be made.

A variety of similarities and differences exist between IFRS and U.S. GAAP.

The following links are from Price Waterhouse Coopers and take you to the same page. It serves as an excellent resource regarding IFRS and U.S. GAAP. It is a lengthy document but very informative.

http://www.pwc.com/us/en/issues/ifrs-reporting/publications/ifrs-and-us-gaap-similarities-and-differences.jhtml

or

https://www.pwc.com/us/en/cfodirect/issues/ifrs-adoption-convergence.html

For this week, please take the time to at least read:

· The importance of being financially bi-lingual and to learn more about IFRS and how it affects US businesses

Also keep the link handy, it does reference many of the topics that we will be covering as the term progresses.