Korea IFRS Manager flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Going concern assessment period

IAS 1 requires an entity to assess going concern for at least twelve months from the end of the reporting period, disclosing material uncertainties if the ability to continue is doubtful.

Adjusting event after reporting period

An IAS 10 event that provides evidence of conditions existing at the reporting date; the financial statements are adjusted, for example a court judgement confirming a year-end obligation.

Change in accounting estimate

Applied prospectively from the date of change under IAS 8; it results from new information or new developments and is not the correction of an error or a change of policy.

IAS 1 information not material

An entity need not disclose information specifically required by an IFRS if that information is not material, although combining immaterial items may still be material overall.

Performance obligation definition

A promise to transfer a distinct good or service to a customer, or a series of distinct goods or services that are substantially the same and have the same pattern of transfer.

Variable consideration constraint

Revenue is recognised only to the extent that it is highly probable a significant reversal of cumulative revenue will not occur when the underlying uncertainty is subsequently resolved.

Principal versus agent

The party controlling the specified good or service before transfer is the principal and recognises gross revenue; the other party is an agent and recognises commission or fee.

Significant financing component

Adjusts the promised consideration for the time value of money using a discount rate determined at contract inception, unless the gap between transfer and payment is one year or less.

Lease liability initial measurement

Present value of lease payments not paid at the commencement date, discounted using the rate implicit in the lease or the lessee's incremental borrowing rate.

Lease term determination

Non-cancellable period plus periods covered by extension options reasonably certain to be exercised, plus periods covered by termination options reasonably certain not to be exercised.

Short-term lease exemption

A lessee may expense lease payments on a straight-line basis for leases with a term of twelve months or less at commencement and no purchase option.

Finance lease indicators

Ownership transfers, bargain purchase option, term for the major part of economic life, present value of payments substantially all of fair value, or a specialised asset with no alternative use.

SPPI contractual cash flow test

Contractual cash flows must be solely payments of principal and interest on the principal amount outstanding; otherwise the financial asset is measured at fair value through profit or loss.

Expected credit loss measurement

A probability-weighted estimate of cash shortfalls discounted at the effective interest rate and adjusted for forward-looking information; lifetime ECL applies after significant credit risk increase.

Irrevocable OCI equity election

At initial recognition an entity may irrevocably elect to present fair value changes of an equity investment in OCI; dividends go to profit or loss and no gain is recycled.

Ten percent derecognition test

A financial liability is extinguished when the present value of revised cash flows, including fees net of fees, differs by at least ten percent from the original liability.

Control under IFRS 10

The investor has power over the relevant activities, exposure or rights to variable returns from its involvement, and the ability to use its power to affect those returns.

Goodwill acquisition formula

Consideration transferred plus non-controlling interest plus fair value of previously held interest, less the net identifiable assets acquired measured at acquisition-date fair value.

Measurement period IFRS 3

A maximum of twelve months from the acquisition date during which provisional amounts may be adjusted retrospectively for new information about facts existing at the acquisition date.

Significant influence presumption

IAS 28 presumes significant influence when an investor holds twenty percent or more of the voting power of the investee, unless that presumption can be clearly demonstrated otherwise.

Development capitalisation criteria

Six IAS 38 criteria: technical feasibility, intention to complete, ability to use or sell, probable future economic benefits, adequate resources, and reliable measurement of attributable expenditure.

Impairment recoverable amount

The higher of fair value less costs of disposal and value in use, determined for an individual asset or for the cash-generating unit to which the asset belongs.

Revaluation surplus treatment

An increase in carrying amount is recognised in OCI and accumulated in equity as a revaluation reserve, unless it reverses a revaluation decrease previously recognised in profit or loss.

Investment property fair value model

Under IAS 40 fair value changes are recognised in profit or loss; the investment property is not depreciated and transfers are made only when there is a change in use.

Provision recognition criteria

A present obligation arising from a past event, a probable outflow of resources embodying economic benefits, and a reliable estimate of the amount of the obligation.

Defined benefit remeasurements

Actuarial gains and losses and the return on plan assets excluding amounts included in net interest are recognised in OCI and are never subsequently reclassified to profit or loss.

Equity-settled share-based payment

Measured at the grant-date fair value of the equity instruments granted and recognised over the vesting period with a corresponding increase in equity, with no subsequent remeasurement.

Onerous contract provision

Recognised at the best estimate of the present obligation, being the lower of the unavoidable cost of fulfilling the contract and the compensation or penalty arising from failure to fulfil it.

Deferred tax liability definition

An amount of income tax payable in future periods in respect of taxable temporary differences, measured using tax rates enacted or substantively enacted by the reporting date.

Fair value definition IFRS 13

The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Level 3 fair value inputs

Unobservable inputs for the asset or liability, used where relevant observable inputs are unavailable, reflecting assumptions that market participants would use when pricing the asset or liability.

Pillar Two deferred tax exception

IAS 12 requires disclosure that the entity has applied the temporary exception from recognising and disclosing deferred tax assets and liabilities related to Pillar Two legislation.