Financial Accounting
Financial Accounting in Myanmar DA Part II Module I tests how you apply the Myanmar Financial Reporting Standards (MFRS), which are IFRS-based, to recognition, measurement, presentation and disclosure. Expect the conceptual framework, revenue, leases, provisions, financial instruments, consolidation and cash flows.
Core rules
- Apply the five-step revenue model: contract, performance obligations, transaction price, allocation, recognition.
- Recognise a lease liability at the present value of lease payments and a right-of-use asset.
- Recognise a provision only when a present obligation exists, outflow is probable and the amount can be estimated.
- Consolidate controlled entities and eliminate intragroup balances.
- Present financial statements under MFRS 101 with comparative information.
Worked example
A builder has a fixed-price contract of 1,200m, total expected cost 800m, and has incurred 240m cost by year-end, representing 30% progress. Revenue = 1,200 × 30% = 360m. Cost = 240m. Profit = 120m. Recognise revenue over time because the asset has no alternative use and the entity has an enforceable right to payment for performance to date.
Traps
Do not recognise revenue on cash receipt when performance is incomplete. Do not offset assets and liabilities unless permitted. Check whether a lease is short-term or low-value. Related-party disclosures are commonly missed. Ignore tax adjustments in consolidated accounting unless the question asks for deferred tax.