Clearly IFRS

IAS 19 (2011): Employee Benefits

Clearly IFRS: A practical guide to implementing IAS 19 (rev. 2011) – Employee Benefits is intended to assist you in kick-starting your International Financial Reporting Standard (IFRS) adoption efforts and implementation of the standard. Featured in the guide are tools such as steps to implementation designed to help your organization make your adoption of the standard a seamless and easy one.

IAS 19: learn about the changes

With the IFRS adoption process fairly recently completed, Canadian entities may be surprised by the number of significant new IFRSs that are effective in 2013. IAS 19 (rev. 2011) (“IAS 19R”) is an amended standard with changes focused on a number of specific areas, most notably:

• Defined benefit plan accounting
• Definitions (and therefore measurement) of short- and long-term benefits, and employee termination benefits and disclosures

For some entities, the amended standard will have a significant impact; for others this change may be more limited.

To learn more, download the full guide.

IFRS 10: Consolidated Financial Statements

IFRS 10 – Consolidated financial statements is a new standard which supersedes IAS 27 Consolidated and Separate Financial Statements (“IAS 27”) and SIC-12 Consolidation - Special Purpose Entities (“SIC- 12”). The primary goal behind the new standard was to come up with a single model for control which could be applied to all entities.

At the heart of IFRS 10 is the requirement that in order for an investor to have control over an investee, the investor must have all three of the following:

1. Power over the investee;
2. Exposure or rights to variable returns from its involvement with the investee; and
3. The ability to use its power over the investee to affect the amount of the investor’s returns

To learn more, download the full guide.

IFRS 11: Joint Arrangements

Clearly IFRS: A practical guide to implementing IFRS 11 – Joint Arrangements is a resource intended to assist you in kick-starting your International Financial Reporting Standard (IFRS) adoption efforts and implementation of the standard. Featured in the guide are tools such as steps to implementation designed to help your organization make your adoption of the standard a seamless and easy one.

With the IFRS adoption process fairly recently completed, Canadian entities may be surprised by the number of significant new IFRSs that are effective in 2013. IFRS 11 is a new standard and supersedes IAS 31 Interests in Joint Ventures (“IAS 31”) and SIC-13 Jointly-Controlled Entities – Non-Monetary Contributions by Venturers (“SIC-13”).The primary goal behind the new standard was to arrive at an accounting treatment which accurately reflects the true nature of the economic interest held by an entity.

IFRS 11: learn about the changes

The existing policy choice under IAS 31 for jointly-controlled entities is replaced by a requirement to account for an interest depending on the nature of your rights and obligations under a joint arrangement.

Under IFRS 11, the individual assets and liabilities within a jointly-controlled vehicle are not recognized in the financial statements of a party with joint control unless the rights and obligations for those assets and liabilities do in fact reside with the parties to the arrangement, rather than with the vehicle. For those entities previously using proportionate consolidation with joint arrangements that do not use a separate vehicle, the changes (and there are some) will be more limited.

To learn more, download the full guide.

IFRS 13: Fair Value Measurement

IFRS 13 – Fair Value Measurement (IFRS 13) is a standard which establishes a framework for the measurement of fair value. The standard does not determine when fair value should be measured but rather sets out requirements as to how fair value should be measured when another standard requires the use of fair value measurement or requires fair values to be disclosed. In addition to the measurement requirements of the standard, IFRS 13 also includes comprehensive disclosure requirements.

To learn more, download the full guide.

IFRS 15: Revenue from Contracts with Customers

At the end of May 2014, IFRS 15: Revenue from Contracts with Customers (IFRS 15) was released. This standard outlines a single comprehensive model of accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance.

The core principle of IFRS 15 is that an entity will recognise revenue to reflect the transfer of goods or services, measured as the amount to which the entity expects to be entitled in exchange for those goods or services. In particular, the new standard requires distinct goods or services to be accounted for separately, which may have a significant impact on the timing of revenue and profit recognition.

While the overall principles will sound familiar, IFRS 15 includes a significant amount of guidance on many issues that arise in determining the appropriate timing and measurement of revenue. Finally, the new standard also requires significant disclosures relating to the reporting of revenue, and entities will need to ensure that they can gather the appropriate information in a timely manner.

To understand the key aspects of this standard, you can download our May 28, 2014 issue of IFRS in Focus.

To access our series of financial reporting updates webcasts including The new revenue recognition standard webcast, please visit our webcast archives.

Our experts have also created nine Industry insights for IFRS 15 publications as part of Deloitte’s Clearly IFRS series. These publications highlight potential changes in timing of recognition, measurement (including allocation of revenue between goods and services provided) and disclosure.

To learn more, download the publication relevant to your organization using the links below.

Consumer products
Key insight: Entities that ship goods FOB shipping point but retain some form of risk during shipment may be able to recognise revenue earlier if control passes to the customer at the point of shipment.

Industrial products
Key insight: The new model provides for recognition of revenue as customized products are produced, depending on the terms of the contract with the customer, and specifically, the termination provisions. Organizations may determine that revenue should be recognised earlier as compared to current practice.

Retail, wholesale and distribution
Key insight: An entity in the retail sector will have to consider if a warranty provides assurance that a product meets agreed-upon specifications only, or if it provides for additional maintenance service. The latter will require accounting for a separate performance obligation.

Real estate
Key insight: Some entities in the real estate sector will find that revenue previously recognised at a point in time should now be recognised over time, or vice versa.

Media
Key insight: Media companies often offer bundles of goods and services to their customers. For example, a multimedia advertising campaign may include more than one type of advertising placement such as print, online and television.  Entities will need to assess whether the advertising services represent separate performance obligations, to which the transaction price will have to be appropriately allocated, or whether they should be accounted for as one obligation.

Technology
Key insight: IFRS 15 distinguishes between licences that represent the transfer of a right to use an entity’s intellectual property  (recognised at a point in time) and licences that represent the provision of access, over a period of time, to an entity’s intellectual property (recognised over the period of access). Entities within the technology sector will need to examine licence arrangements in light of this new guidance, and may need to change their existing accounting.

Telecommunications
Key insight: Airtime providers will now be required to recognise more revenue associated with a subsidized handset at the start of the contract and less revenue as the contract continues regardless of the pattern of billings.

Coming soon

Mining

Oil & gas