Dear all,
can anyone please guide me if there are any guidelines as to establish
date of commercial production in a manufacturing concern in IFRS.
thanks and regards
deepak

Hi Deepak,
I assume you are inferring to either intangible assets.
There is no specific guidance as to this date.
However, it is not unusual to assume the date of commercial production
to be the date (month) in which the first commercial orders are
processed in relation to the intangible.

Hi Alan
My query is regarding trial run expenditures in a manufactuing
concern. Till when can the trial run expenditures be capitalised in a
manufacturing …

To all,
Can any one clarify whether it is necessary for provision for
commission to agents to be made for the premiums not yet received, at
the end of every month.
jay

For any provision, I think you’d first need to look at IAS 37 paragraph 14.
Is there a present obligation as a result of a past event?
Is it probable that there will be an outflow of resources to settle
the obligation?
Can the amount be reasonably estimated?
Whether or not the premiums have been received is not relevant.
Craig

If you recognise an income in the Profit & Loss …

Dear IFRS team,
We provide for early retirement or termination charges. Would it be
right in making the provision for the whole liability
(which could be for 5-10 years) that we know about in the year which
we make that commitment, or should this cost just hit the P&L as and
when it occurs?
Many thanks for your help,
Sheetal

Hi Sheetal
Termination benefits are recognized only when the employer has
demonstrated its commitment to provide the benefits with a formal
detail plan for the dismissal of group of employees, when the employer
has contractually agreed to pay a termination benefit to …

Dear All
Greeting
In UAE work visa would be for 3 years and cost would be paid by the
employer and in my company it is practice to debit as administration
expense. Employees must has to complete 3 years and if he/she leave
the job prior to three years he has to pay back the full visa cost to
company.
In my opinion it should be capitalized and depreciated for three years
to meet fair presentation of financial reporting standard.
Please suggest appropriate treatment
Regards,
Ahmad

Dear Ahmad,
I think you should put the cost in prepayments and write-off against
admin expenses during the …

The Company has taken a loan for construction of projects. A part of
amount is kept in FD with the Bank. Interest is capitalized on the
amount paid as per payment certificates like draw down. If the project
is capitalized and 2 payment certificates received after the
capitalization date. Now question is whether interest will be
capitalized on amount paid after capitalization date or expensed out.
Hemant

I think after the project is completed, the interest expenses, is charged to
P&L.
Krishnendu

Query is not clear:

1. If the loan was taken for construction, interest component to the date of capitalization …

Dear All
 
Can any body tell me that is budget only for expenses or can be for Asset, liabilities and income also. My openion is it can be for all (Asset, liability, Expense and income). Please help me according to the IAS/IFRS.
–
Best regards
Mohammad

Dear Mohammed :-
 
Budget can be to revenue& expenses but when we put assets & liabilities we can called it Feasibility study to project we make this in starting of any activity .
 
Best Regards
Aly

Budgets are prepared both for revenue and capital expenditure. Revenue Budget gives you the financial progress of the company …

Dear all,
during an interview I was asked this question and I am still in doubt about the reply.
If you need to audit an entity which is going to change from a cash basis to an accrual basis accounting system, what would you audit first and why?
Thanks for your replies.

Fabiola

 
Dear Fabiola
 
First thing I would audit the statement for the period end under review containing the dues not receivable for the servcies or sales already done during the year and likewise, payment received from clients in advance for the sales or services …

Dears
Would you please explain me what is the difference between affiliates
and subsidaries, and then if there is any difference in accounting
treatments.( i am asking these question w.r.t an investment co.)
2nd thing is how i will treat the personal expenses of a partner which
are being paid by the co. and where i have to show it in the balance
sheet.
Regards,
Hameed

Dear Hameed
The shares of subsidiary company should be owned by holding company
but for affiliates, the relationship is a connected party.
Thanks and regards
Simon

Dear Simon
Thanx for your reply, dear would you please explian me more, …

Dear All,
The Company was incorporated in Oct 2007.Could you please give your
expert opinion on the treatment of preliminary expenses (Revenue
generation is not yet started) e.g. rent, salary, traveling etc.
incurred during Oct 2007- Aug 2008. Please reply in reference to IFRS.
Revenue is expected in Sept 2008.
In my view, preliminary expenses can be accumulated and amortized when
revenue is started due to matching concept.
BestRegards,
Hemant

Preliminary expenses / startup costs, etc. cannot be deferred. They
have to be charged off to income statement in the year of actual
startup of operations.
–
Thanks & Regards
Anand

Hemant,
Whether to Deffer the preliminary …

Hi all,
A non-profit organisation based in Virginia, USA was donated part of
real estate’s value.Currently the real estate is being adminstered by
an agent.I would appreciate if any one could hint me what both IFRS
and USGAAP recommends for treating such transaction.
Thank you
Aklilu

Hi,
When you say value, I assume a cash donation was made to buy the
property. Is the property been transferred in the name of this
organization. If it has, this means that risks and rewards of
ownership have been trasferred.
I would assume, IAS 20, Grant accounting rules will need to be followed.
The amount of …

Please let me know about cost of create new web sit
will it be general expenses or intangible assets 
So, which treatment prefered to be confirmed to international accounting standard
 
thank you
 
Mahmoud Gbr
Auditor

General expense: if there is no link to future cash inflow through this
 
Intangible asset: if satisfy the conditions of IAS 38 ..cash inflow, technical feasibility, intention, available market etc.
 
Thank you,
Regards,
Debdulal

Do you expect with relative certainty that the development of the new web will bring new cashflows to the company?

 
If yes-then it should be recognised as an asset
If not-it is an expense and should be …

Hi

 
Please let me know the salient points in IFRS 7 which has been recently been made a mandatory disclosure in the audited financial statements.
Regards
Raghavan
 

 
Under IFRS 7 there are 12 requirements:
 

Requirement 1
Reconciliation of carrying amounts by classes of financial instruments to IAS 39 measurement categories (at least these categories are HTM, AFS, FVTPL, Loans and Receivables). An entity shall make the decision which classes of financial instruments are appropriate to the nature of the information disclosed taking into account the characteristics of those financial instruments.

Requirement 2
Description of processes for managing the …

I am looking for a few things:1) Quality example of financial statements with the income statement
presenting expenses classified by nature (as opposed to function).2) Quality example of early adoption of the amendments to IAS 1 with
a) Statement of Comprehensive income as one statement, and b)
Statement of Income separate from Statement of Comprehensive income.Any help on either appreciated, thanksGord

Q. How are ‘Prior year’s expenses defined and treated?

Hi ,

If provision for Bonus was taken in 2007 for X amount and financial statements for 2007 closed and reported , and in 2008 the payout of Bonuses was more than the provisions amount. As per IFRS , what is acceptable??
1- should we classify the over expensed amount as Prior year expenses ( is this accp as per IFRS )
2- should i expense this amount in 2008 ?
I used to do this as prior year expenses , but i heard that as per IFRS now we should …

Dear Ali,
It is very nice for me to see your name in our group since I have remember our past in Arthur Andersen.
 
Referring to your question, I think the fixed part should be evaluated as fixed and the overtime part as variable.
 
Kind regards,
 
Alper

Hello All …

This is an interesting question – but I would argue that the simple ‘variable – v – fixed’ cost focus is constrained if one doesn’t take a broader view of these costs.
As clearly the (“blue-collar”) labour involved is a ‘Cost of Sales’, the amount of labour …

Dear all,
I cannot find how can I book the fx loss, gain into profit and loss
account. Should I book it as other cost/revenue or financial
cost/revenue?
–
Taczmann

Book it as a separate component of financial expenses and income, so the
categories should be:
Interest income
Interest expense
Foreign currency gains (losses)
Net financial results = sum
Kind regards,
Henk

Dear Judit
In practice most of the company showing FX charges in  Financial
charges.
With Best Wishes and Regards

Thank you for your answer, however in Austrian GAAP, the f/x loss is
shown as other cost and f/x gain on a/p or a/r is shown as other
revenue. …

Dear All,

Our company has constructed a building which is to be our Head office. As part of improvements made on the buildings land, management decided to put up a garden with orchards and both Traditional and exotic trees. The garden is to beatify the environment as part of the environmental degradation measures and also enable the staff to go and relax. Out of the expenses so far incurred its felt we capitalize such expenses. I have gone thru the IAS 41 on agriculture where by they can be taken as …

Dear All
 
I am going to attend a job interview at Deloitte about the position of Audit. My BA and MPhil degree are not relevant to accounting or finance, and I don’t have any background knowledge about audit. I know in the interview you might ask me to give some examples of working in a team or under pressure, and I can handle them. However, I do not have much knowledge about business issues or what exams I will take in the first year. Can anyone tell me how to get …

Morning All,
Our company incurs a lot of expenses in terms of projects work like traveling. Substance, entertainment allowances etc
We also do incur expense interims of the preliminary expenses like site visits, negotiating meetings.

Are these expenses to be expensed or capitalized as we seems to have a different view of this from IAS 16.
Secondly before we begin any project we are supposed to remit 0.1% of the project cost as a government requirements to Environmental authority . Should such expenses be capitalized as per IAS 16 para 11
…