Financial Accounting and Reporting (IFRS)
What the exam tests
Financial reporting under IFRS as applied in Kazakhstan. Public interest entities must prepare IFRS financial statements; other entities may use IFRS for SMEs or national standards. Questions test recognition, measurement, presentation and disclosure, and the adjustments needed when local practice differs from IFRS.
Core rules
- IFRS 15: identify the contract, performance obligations, transaction price, allocate the price, and recognise revenue when control transfers. VAT is not revenue.
- IFRS 16: a lessee recognises a right-of-use asset and lease liability at the present value of lease payments, unless short-term or low-value exemptions apply.
- IAS 12: recognise deferred tax on temporary differences; Kazakhstan CIT is 20%.
- IAS 21: determine the functional currency; translate foreign operations before consolidation.
- IAS 1: going concern, accrual basis, materiality and comparability drive presentation.
Worked example
A Kazakhstan retailer sells equipment for KZT 1,120,000 including 12% VAT and also provides installation. Standalone prices are KZT 950,000 for equipment and KZT 150,000 for installation. Transaction price excluding VAT is 1,120,000 / 1.12 = KZT 1,000,000. Allocate: equipment 1,000,000 × 950/1,100 = KZT 863,636; installation KZT 136,364. Recognise equipment when control passes and installation over time if the service criteria are met. The KZT 120,000 VAT is a tax liability, not revenue.
Traps
Including VAT in revenue; allocating a discount only to one obligation; ignoring deferred tax on right-of-use assets; expensing lease payments when IFRS 16 applies; using tax depreciation as accounting depreciation.