IFRS in Focus – Accounting considerations related to the Coronavirus 2019 Disease

The coronavirus 2019 (COVID-19) pandemic is affecting economic and financial markets with entities experiencing conditions often associated with a general economic downturn. These include, but are not limited to, financial market volatility and erosion, deteriorating credit, liquidity concerns, further increases in government intervention, increasing unemployment, broad declines in consumer discretionary spending, increasing inventory levels, reductions in production because of decreased demand, layoffs and furloughs, and other restructuring activities. The continuation of these circumstances could result in an even broader economic downturn which could have a prolonged negative impact on an entity’s financial results.

Deloitte has recently released an updated IFRS in Focus to discuss certain key IFRS accounting considerations related to conditions that may result from the COVID pandemic.  This publication covers areas including: going concern, impairment of non-financial assets, financial instruments, revenue from contracts with customers, lease contracts, onerous contracts, restructuring plans, government assistance, income tax and breach of covenants. This publication is periodically updated as new developments arise. The English and Chinese versions are available for download from IAS Plus and CAS Plus respectively. 

Deloitte has also produced a video series to support businesses that are affected by COVID-19. These short and informative videos (4-10 minutes in length) supplement this IFRS in Focus. Please click to access the videos on IAS Plus or on DART.