CIFRS

Certificate in IFRS

→ IFRS 13: Fair Value Measurement
• Characteristics of fair value
• Fair value hierarchy and how it is used
• Steps to determine fair value
• Fair value in illiquid markets
• The grey areas and challenges of application for financial instruments that are thinly traded
Case Study: Examples and group discussions on determining the hierarchy rating; determination of highest and best use and calculations of to apply the depreciated replacement cost approach.
→ IAS 32: Financial Instruments – Presentation
• Core definitions in financial instruments
• How to determine if it is a derivative
• Scope of financial instrument standards
• Distinction between debt and equity
• Compound financial instruments
Case Study: Group discussion on complex example of intercompany / related party debt to determine if it should be accounted for as debt or equity.
→ IFRS 9: Financial Instruments - Classification and Measurement of Financial Assets and Liabilities
• Categories of financial assets
• How the business model test works
• Assessing contractual cash flow characteristics
• IFRS 9 “own credit” controversy
• Accounting for intercompany loans not set at market rate
Case Study: Scenario based analysis to determine classification of financial assets under IFRS 9.
→ IFRS 9: Financial Instruments – Derecognition of financial instruments
• Transfer of risk and rewards and control test for determining when to derecognise
• Liabilities quantitative and qualitative tests for derecognition
Case Study: Analysing a number of scenarios to determine if the financial instruments should be derecognised.
→ IFRS 9: Financial Instruments – Impairment of Financial Assets
• Differences between the incurred loss model and expected loss model
• Expected loss model core differences to US GAAP
• Development of key assumptions in loss model
• Practical implementation challenges
Case Study: Numerical example applying IFRS 9 to debt categorized at fair value through other comprehensive income.

→ IFRS 9: Financial Instruments – Hedge Accounting
• Core principles and different types of hedges
• Accounting treatment
− Fair value hedges
− Cash flow hedges
• How to deal with hedge ineffectiveness
• Practical implementation challenges
Case Study: Short discussion example on determining type of hedge.
→ IFRS 7: Financial Instruments – Disclosures
• Categories to disclose of financial assets and liabilities
• Credit risk, liquidity risk and market risk disclosure

→ IAS 19: Employee Benefits
• Background of what is covered in IAS 19
• Accounting for short term benefits
• Accounting for post- retirement plans
− Defined benefit plans
− Defined contribution plans
• Current and past service costs
• Actuarial assumptions and treatment of actuarial gains and losses
Case Study: Numerical case study on accounting for an end of service scheme; numerical example on a continued long service award paid during employment.

→ IFRS 3: Business Combinations
• Determining if an asset purchase or a business combination
• Options of how to recognise and measure goodwill
• Purchase price allocation
• Exceptions to the general recognition and measurement principles
• Deferred tax issues with consolidation
→ IFRS 3: Mechanics of Consolidation
• Steps and procedures to follow
• Handling fair value adjustments
• Accounting for contingent consideration
• Intergroup trading and recording unrealised profit for parent and NCI
• The journal entries
Case Study: Determining goodwill and preparing and posting the journal entries for a parent subsidiary consolidation.
→ IAS 27: Separate Financial Statements
• Approach and differences to consolidated financial statements
→ IAS 28: Investments in Associates
• Determining significant influence
• Application of the equity method
• Adjustments required for consolidated financial statements including fair value differences
→ IAS 21: Effects of Changes in Foreign Exchange Rates
• Discussion of functional, foreign and reporting currency
• How the functional currency is determined and differences to US GAAP
• Foreign currency transaction and translation accounting treatment
• Goodwill and fair value adjustments under IAS 21
• Treatment of net investment in foreign entities
→ IFRS 11: Joint Arrangements
• How joint control is determined
• Types of joint venture arrangements
• Accounting treatment and adjustments required
Case Study: Scenario to discuss and determine if a structure is accounted for as a joint arrangement.
→ IFRS 12: Disclosure of Interests in Other Entities
• Definitions and core concepts
• What needs to be disclosed
• NCI disclosures
• Unconsolidated structured entities – the issue and key considerations

→ IAS 24: Related Party Disclosure
• Core concepts and definition
• How to identify related parties
• Investments of key management personal considerations
• Disclosure requirements
→ IAS 8: Accounting Policies, Changes in Estimates and Errors
• Accounting policy and related disclosures
− Potential changes on the horizon in disclosures
• Treatment of changes in accounting policies, errors and estimates
Case Study: Interesting scenario for group discussion to assess treatment under IAS 8.
→ IAS 34: Interim Financial Reporting
• Purpose of core principles of this standard
• Minimum components of an interim financial statement
• Revenues received seasonally, cyclically or occasionally
→ IAS 7: Statement of Cash Flows
• Comments from regulators and financial analysts
• Cash and cash equivalents
• Classification of operating, investing and financing activities
• Differences with the direct and indirect method
• Non-cash transactions
Case Study: Short calculation on leasing example and its impact on the cash flow statement; example of foreign exchange on asset purchase and impact on cash flow statement.
→ IAS 10: Events after the Reporting Date
• Overview of the standard
• Classification and treatment of events as adjusting and non-adjusting
• Going concern considerations
» IAS 33: Earning per Share (only covered if requested by class)
» Objective of the standard
» Calculating basic and diluted EPS
» Impact convertible loans and share options
» How to deal with changes in capital structure

→ IFRS 1: First Time Adoption of IFRS
• Scope of the standard
• Options / alternatives to move to IFRS under IFRS 1
• Presentation and disclosure requirements
Case Study (only if requested by class):
Numerical example on transitioning to IFRS with allowable methods.

→ IFRS 16: Leases
• Overview of the changes from IAS 17 to
IFRS 16 and the key differences
• Problems with IAS 17 and why IFRS 16 was issued
• How to apply the revised single model approach
• Exceptions for short term and low value leases
• US GAAP dual model approach and key differences
• Impact on financial statements and debt covenants
Case Study: Examples to assess if there is a leasing component for several scenarios; If time permits, a short numerical exercise on the transition to IFRS 16.

→ IFRS 15: Revenue from Contracts with Customers
• Key differences from the old IAS 18 that was discontinued in 2017 to IFRS 15
• Detailed review of the new five step model
− Identification of the contract
− Identification of the performance options
− Determining and allocating the transaction price
Case Study: Thought provoking examples and scenarios covering the different steps of this complex standard.