LOAN

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Interest free loan with no fixed repayment terms

Scenario: In June 2006, XYZ Co. obtained an interest free loan amounting to USD 50 million from a third party with no fixed repayment terms. Under the terms of the loan agreement, the loan is to be repaid in annual installments, each equal to 60% of X...

By |October 31st, 2010|OTHER IFRS|2 Comments

Deferrement of arrangement fee for obtaining loan

Can the arrangement fee (agengy fees, structuring fee and legal charges) paid to obtain a long term loan be deferred and subsequently amortised over the tenure of the Loan? Kindly give references from IFRS. Regards, Ali

By |October 21st, 2009|OTHER IFRS|2 Comments

Interest Capitalization

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 [...]

By |December 15th, 2008|IFRS|0 Comments

Difference between affiliates and subsidaries

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 [...]

By |December 15th, 2008|CONSOLIDATION|0 Comments

Forex hedging treatment and disclosure.

Dear all My Company has an outstanding USD loan of say US$10m and as our main subsidiaries are operating in China and earns revenue denominated in RMB, which will ultimately flow to our company in terms of RMB dividend (converted to USD due to exchange regulation in PRC). As we need to make periodic payments [...]

By |December 15th, 2008|IFRS|0 Comments

Budget

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 regard...

By |December 14th, 2008|AUDIT, IFRS, OTHER, TAX|0 Comments

Loan Impairment

Is there any guideline for measurement of loan impairment and recognition of interest income by using effective rate method Asim well Esther the UK leads the path i.e. the UK tax authorities are the only ones in Europe which accept IFRS reporting to the extent that its website http://www.hmrc.gov.uk/ does have a section allocated to [...]

By |December 14th, 2008|IFRS|0 Comments

IFRS India

Hi, I am a Chartered Accountant in India and am interested in learning IFRS. Can somebody tell me whether there is any institution through whom I can do some formal course like diploma on IFRS. Else how does one upgrade himself to know more about IFRS. This being one of the big oppurtunity to grab in [...]

By |December 14th, 2008|IFRS|1 Comment

IFRS 7

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 Reconciliat...

By |December 14th, 2008|AUDIT, DOCUMENTS, FAIR VALUE, FINANCIAL INSTRUMENTS, IAS 39, IFRS, IFRS 7|0 Comments

Waiver of Inter company Loan

Please let me know the treatment of Inter company loan waiver.Example  Company A is fellow subsidiary of company B. And company B has given loan to company A for $ 10,000 and there is accrued interest of $ 1000 on loan. Now Company B waive off all loa...

By |August 28th, 2008|CONSOLIDATION, DOCUMENTS|0 Comments

Loans

Dear All, Can Loan be classified as Available for sale investments (as it is open category). Please answer while considering IAS 39. Thanks Muhammad […]

By |August 28th, 2008|FINANCIAL INSTRUMENTS|0 Comments

IAS 23 Borrowing costs – Forex diffrences

As per the amended IAS 23, all borrowing costs on qualifying assets should be capitalised (no option to expense). Does exchange differences on foreign currency loans qualify as borrowing costs to be capitalised? Best regards Allan Hi Allan To my understanding any positive/negative FX difference is expensed directly to the P&L. Regards, Marc The change to [...]

By |August 28th, 2008|IFRS|1 Comment

Preparation of financial from IGAAP To IFRS

Dear All  i am working in a home finance company which is subsidary of german company, due to which we are require to prepare the financial from IGAAP to IFRS. i have the following questions:- 1.we take a loan and in taking loan that we usually pay a processing fee. 2. we pay security deposit [...]

By |August 28th, 2008|IFRS|0 Comments

IFRS

Dear Vatsla can you answer my following question in details. 1. we take a loan  and pay processing fee for taking loan. for eg. if we take a loan of rs 10 lacs , we generally pay processing fee of rs.50000. if you see the net amount in hand is rs 9.5 lacs As per [...]

By |August 28th, 2008|IFRS|0 Comments

Interest income recognition usingeffective rate

If an institution is recognizing income by using flat rate method, but IFRS requires to recognize by using effective rate method. My questions are: a) policy remains but financial statements it should be based on effective rate. Is it? b) How to convert portfolio by using effective rate.?     asim I don't think so, [...]

By |August 28th, 2008|IFRS|0 Comments

Cash equivalent

Dear all Please help in deciding what items can be regarded as cash equivalents > Thanks in advance! Regards, Lina Cash equivalents are financial instruments that can be easily converted to cash, have high liquidity like stock of quoted companies. Best Regards. Alberto     Lina, I woul suggest to take a look into IAS [...]

By |August 28th, 2008|IFRS|0 Comments

Cost of conversion

I have some clients asking for studies that show the cost of conversion to IFRS for companies that have been through this.  Does anyone know of resources for this?   Thanks Gord     and if anyone could link to any material about IFRS Conversion Project Management staff?   Thanks.   Lado Hi Gord,   I [...]

By |August 28th, 2008|IFRS|0 Comments

Loan recording

Hi all,   I am bhenzer a neophyte in ifrs from Philippines. Can anyone please tell me how to journalize this.   My company obtained a loan in December 2007 in the amount of 20 Million to be amortized in 10 years beginning 2010 in 120 equal monthly installments. Interest from December 2007 to December 2009 [...]

By |August 28th, 2008|IFRS|0 Comments

Loans interest

Good day, Could you tell how we record loans interest should I have provision then I amortize it on yearly basis or should I record the interest expense at the end of each year according to IAS what should I do. Regard. Hi Amir,     First of all you need to make an estimation [...]

By |August 28th, 2008|IFRS|0 Comments

Please guide on this

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 [...]

By |August 27th, 2008|IFRS|0 Comments