IFRS Implementation – Process Flow
Moving on in the IFRS reporting process, let’s take a brief look at the process flow. The logical starting point is the Statement as per Local GAAP and ending with Statement as per IFRS. The transformation in between would consist of Measurement, Recognition and Reclassification.
IFRS Process Flow
Lets look at each of these in a simple manner.
Measure as per IFRS:
IFRS - Measurement of Difference
Recognition / De-recognition of certain financial entries:
|
Recognize |
Derecognize |
|
• Pension Liabilities • Deferred tax assets and liabilities • Finance lease assets and liabilities • Provisions, only of legal or constructive • Derivative financial instruments • Acquired intangible assets • Internal development cost |
• Provision, if no legal obligation (eg. Certain restructuring liabilities) • General reserve as liabilities • Deferred tax assets, if not probable • Treasury shares as assets • Intangible assets, not meeting criteria • Discounting of long term receivables / payables |
Finally Re-classification under IFRS:
IFRS - Reclassification
This this not intended to be an exhaustive list but more to represent the kind of changes that will be required to be made.
|
Recognize |
Derecognize |
|
• Pension Liabilities • Deferred tax assets and liabilities • Finance lease assets and liabilities • Provisions, only of legal or constructive • Derivative financial instruments • Acquired intangible assets • Internal development cost |
• Provision, if no legal obligation (eg. Certain restructuring liabilities) • General reserve as liabilities • Deferred tax assets, if not probable • Treasury shares as assets • Intangible assets, not meeting criteria • Discounting of long term receivables / payables |
