Microsoft PowerPoint -
1-Framework-and-IAS-1-(2007-03)-To-ACCAFramework and IAS 1 March
2007
Nelson LamNelson Lam MBA MSc BBA ACA CFA CPA(Aust) CPA(US) FCCA
FCPA(Practising)
© 2005-07 Nelson 2
Today’s Agenda Simple but
Comprehensive Simple but
and key issues
Capital Disclosures (Amendments to IAS 1)
Capital Disclosures (Amendments to IAS 1)
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endorsed by the International Accounting Standard Board and
comprise: – International Financial
Reporting Standards (IFRSs); – International Accounting
Standards (IASs); and – Interpretations.
7 Sets in issue (from IFRS 1 to IFRS 7) 7 Sets in issue (from IFRS
1 to IFRS 7)
31 Sets in issue (from IAS 1 to IAS 41) 31 Sets in issue (from IAS
1 to IAS 41)
• What is the difference between IFRS and IAS? • IASB has
designated its standards as IFRS • The accounting standards issued
by its predecessor, the International
Accounting Standards Committee (IASC), continue to be designated as
IAS.
• IASB endorsed all IASs and designated the IFRSs to include
IASs
• What is the difference between IFRS and IAS? • IASB has
designated its standards as IFRS • The accounting standards issued
by its predecessor, the International
Accounting Standards Committee (IASC), continue to be designated as
IAS.
• IASB endorsed all IASs and designated the IFRSs to include
IASs
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Introduction ……
After the training, you may realise that some traditional thinking
…… – Assets = Liabilities + Capital – Extraordinary items should
be
reported in the income statement …… – Cash at bank and deposits in
bank
should be current assets All should be
adjusted now!
now!now!
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What is Framework?
• Sets out the concepts that underlie the preparation and
presentation of financial statements for external users
• Assists preparers of financial statements in applying accounting
standards
• Assists users of financial statements in interpreting the
information contained in financial statements prepared in
conformity with accounting standards
• But is not a standard or guideline, – so does not override any
specific accounting standard
Framework
• Deals with a) The objective of financial statements; b) The
qualitative characteristics of financial information; c) The
definition, recognition and measurement of the elements in
the
financial statements; and d) Concepts of capital and capital
maintenance.
• Concerned with general purpose financial statements • The users
of financial statements include:
– present and potential investors, employees, lenders, suppliers
and other trade creditors, customers, governments and their
agencies and the public
Framework
Capital Concepts of
Company’s activities Accounting User
perception
Company’s activities
Financial Reporting
User perception
IAS 1 states that: • The objective of general purpose financial
statements is to provide
information about the financial position, financial performance and
cash flows of an entity that is useful to a wide range of users in
making economic decisions.
• Similar to the objective stated in the Framework
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Objective Assumptions Underlying Assumptions include: • Accrual
Basis
– In order to meet their objectives, financial statements are
prepared on the accrual basis of accounting.
– Under this basis, • the effects of transactions and other events
are recognised when they
occur (and not as cash or its equivalent is received or paid) and •
they are recorded in the accounting records and reported in
the
financial statements of the periods to which they relate. • Going
Concern
– The financial statements are normally prepared on the assumption
that an entity is a going concern and will continue in operation
for the foreseeable future.
– Hence, it is assumed that the entity has neither the intention
nor the need to liquidate or curtail materially the scale of its
operations; if such an intention or need exists, the financial
statements may have to be prepared on a different basis and, if so,
the basis used is disclosed.
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• Relating to content - Relevance (Predictive value, Confirmatory
value, Interrelated)
- Reliability (Faithful representation, Substance over form,
Neutrality, Prudence and Completeness)
• Relating to presentation - Comparability (Consistency and
Disclosure)
- Understandability (Users’ ability, Aggregation and
Classification)
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• Relating to content - Relevance - Reliability
• Relating to presentation - Comparability -
Understandability
Management Decision
Management Decision
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cost)cost) •• Discussing convergence in certain practicesDiscussing
convergence in certain practices •• From IASC to IASB
(International Accounting Standard Board)From IASC to IASB
(International Accounting Standard Board) •• From IAS to IFRS
(International Financial Reporting From IAS to IFRS (International
Financial Reporting
Standards) Standards) …………
Qualitative Characteristics
Management Decision
Management Decision
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Financial Position (in balance sheet)
Financial Performance (in income statement)
• a resource controlled by the enterprise as a result of past
events and from which future economic benefits are expected to flow
to the enterprise
• a present obligation of the enterprise arising from past events,
the settlement of which is expected to result in an outflow from
the enterprise of resources embodying economic benefits
• the residual interest in the assets of the enterprise after
deducting all its liabilities
• increases in economic benefits during a period in the form of –
inflows or enhancements of assets or – decreases of liabilities
that result in increases in equity – other than those relating to
contributions from equity participants
• decreases in economic benefits during a period in the form of –
outflows or depletions of assets or – incurrences of liabilities
that result in decreases in equity, – other than those relating to
distributions to equity participants
Balance Sheet Approach
Financial Position (in balance sheet)
Financial Performance (in income statement)
• a resource controlled by the enterprise as a result of past
events and from which future economic benefits are expected to flow
to the enterprise
• a present obligation of the enterprise arising from past events,
the settlement of which is expected to result in an outflow from
the enterprise of resources embodying economic benefits
• the residual interest in the assets of the enterprise after
deducting all its liabilities
• increases in economic benefits during a period in the form of –
inflows or enhancements of assets or – decreases of liabilities
that result in increases in equity – other than those relating to
contributions from equity participants
• decreases in economic benefits during a period in the form of –
outflows or depletions of assets or – incurrences of liabilities
that result in decreases in equity, – other than those relating to
distributions to equity participants
DefinitionDefinition
IFRS ApproachIFRS Approach
DefinitionDefinition
RecognitionRecognition
MeasurementMeasurement
Definition
Criteria for recognition – an item that meets the definition of an
element should be recognized if: 1. it is probable that any future
economic benefit
associated with the item will flow to or from the enterprise;
and
2. the item has a cost or value that can be measured with
reliability.
Criteria for recognition – an item that meets the definition of an
element should be recognized if: 1. it is probable that any future
economic benefit
associated with the item will flow to or from the enterprise;
and
2. the item has a cost or value that can be measured with
reliability.
Recognition is the process of incorporating in the balance sheet or
income statement an item that 1. meets the Definition of an element
and 2. satisfies the Criteria for Recognition
Recognition is the process of incorporating in the balance sheet or
income statement an item that 1. meets the Definition of an element
and 2. satisfies the Criteria for Recognition
Elements of Financial Statements
Objective Qualitative Characteristics ElementsElements
Value in use
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Concept of Capital Financial concept of capital • is adopted by
most enterprises in
preparing their financial statements • Under it, such as invested
money or
invested purchasing power, capital is synonymous with the net
assets or equity of the enterprise.
Physical concept of capital • Under it, such as operating
capability,
capital is regarded as the productive capacity of the enterprise
based on
• For example, units of output per day
Capital and Capital Maintenance
Capital Concepts of
Concept of Capital Maintenance Financial concept maintenance •
Under this concept, a profit is
earned only if • the financial (or money) amount of
the net assets at the end of the period
• exceeds the financial (or money) amount of net assets at the
beginning of the period
• after excluding any distributions to, and contributions from,
owners during the period.
• Financial capital maintenance can be measured in either nominal
monetary units or units of constant purchasing power
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Concept of Capital Financial concept of capital • is adopted by
most enterprises in
preparing their financial statements • Under it, such as invested
money or
invested purchasing power, capital is synonymous with the net
assets or equity of the enterprise.
Physical concept of capital • Under it, such as operating
capability,
capital is regarded as the productive capacity of the enterprise
based on
• For example, units of output per day
Capital and Capital Maintenance
Capital Concepts of
Concept of Capital Maintenance Physical concept maintenance • Under
this concept, a profit is
earned only if • the physical productive capacity (or
operating capability) of the enterprise (or the resources or funds
needed to achieve that capacity) at the end of the period
• exceeds the physical productive capacity at the beginning of the
period
• after excluding any distributions to, and contributions from,
owners during the period.
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Summary of IFRSs
• IASs (International Accounting Standards) – Totally 31 sets
• IFRSs (International Financial Reporting Standards) – Totally 8
sets (up to 4 February 2007)
More are coming ……More are coming ……
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disclosure requirements
and disclosure
• More and clearer presentation and disclosure
•• More and clearer More and clearer presentation and presentation
and disclosuredisclosure
• Aim at enhancing the information for users’ decision making
•• Aim at enhancing Aim at enhancing the information the
information for users’ for users’ decision makingdecision
making
e.g. market value, value by appraisal ……
Inter alia, one more change ……
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Today’s Agenda
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Presentation of Financial Statements (IAS 1)
1. Purpose of financial statements 2. Components of financial
statements 3. Overall considerations 4. Structure and content
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• To provide information about – financial position, – financial
performance,
and – cash flows of an entity,
That is useful to a wide range of users in making economic
decisions
• To also show the results of management’s stewardship of the
resources entrusted to it
• To meet this objective, financial statements provide information
about the entity’s: – Assets – Liabilities – Equity – Income and
expenses,
including gains and losses – Other changes in equity – Cash
flows
Thus, we have ……
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2. Components of Financial Statements
A complete set of financial statements comprises: a) a balance
sheet; b) an income statement; c) a statement of changes in equity
showing either:
i) all changes in equity, or ii) changes in equity other than those
arising from transactions with
equity holders acting in their capacity as equity holders; d) a
cash flow statement; and e) notes, comprising a summary of
significant accounting policies and
other explanatory notes.
another name?another name?
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3. Overall Consideration
a) Fair presentation and compliance with IFRSs b) Going concern c)
Accrual basis of accounting d) Consistency of presentation e)
Materiality and aggregation f) Offsetting g) Comparative
information
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3. Overall Consideration
• Financial statements shall present fairly of the financial
position, financial performance and cash flows of an entity.
– Fair presentation requires the faithful representation of the
effects of transactions, other events and conditions in accordance
with
• the definitions and recognition criteria for assets, liabilities,
income and expenses set out in the Framework.
– The application of IFRSs, with additional disclosure when
necessary, is presumed to result in financial statements that give
a true and fair view.
a) Fair presentation and compliance with IFRSs
No such precisely statement before!
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• Statement of compliance – An entity whose financial statements
comply
with IFRSs shall make an explicit and unreserved statement of such
compliance in the notes.
– Financial statements shall not be described as complying with
IFRSs • unless they comply with all the
requirements of IFRSs. – In virtually all circumstances, a
fair
presentation is achieved by • compliance with applicable
IFRSs.
a) Fair presentation and compliance with IFRSs
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3. Overall Consideration
Melco Development Limited () Notes to the financial statements for
year ended 31.12.2005 – The consolidated financial statements have
been prepared in
accordance with HKFRSs. – In addition, the consolidated financial
statements include applicable
disclosures required by the Rules Governing the Listing of
Securities on The Stock Exchange of Hong Kong Limited and by the
Companies Ordinance.
CaseCase
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3. Overall Consideration
• A fair presentation also requires an entity: a) to select and
apply accounting policies in accordance
with IAS 8 b) to present information, including accounting
policies,
in a manner that provides relevant, reliable, comparable and
understandable information.
c) to provide additional disclosures – when compliance with the
specific requirements in
IFRSs is insufficient to enable users to understand the impact of
particular transactions, other events and conditions on the
entity’s financial position and financial performance.
• Inappropriate accounting policies are not rectified either – by
disclosure of the accounting policies used, or – by notes or
explanatory material.
a) Fair presentation and compliance with IFRSs
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3. Overall Consideration
• Departure from Standard or Interpretation (Simplified) – In the
extremely rare circumstances in which
management concludes that • compliance with a requirement in a
standard or an
interpretation would be so misleading that • it would conflict with
the objective of financial
statements set out in the Framework the entity shall depart from
that requirement if the relevant regulatory framework requires, or
otherwise does not prohibit, such a departure.
a) Fair presentation and compliance with IFRSs
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a) Fair presentation and compliance with IFRSs
– Then, the following disclosure is required: a) management has
concluded that the financial
statements give a true and fair view; b) that it has complied with
applicable standards and
interpretations, except that it has departed from a particular
requirement;
c) the title of the standard or interpretation from which the
entity has departed, the nature of the departure, the reason why
that treatment would be so misleading, and the treatment adopted;
and
d) for each period presented, the financial impact of the departure
on each item in the financial statements that would have been
reported in complying with the requirement.
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3. Overall Consideration
Interim Report 2005 clearly stated that:Interim Report 2005 clearly
stated that:
CaseCase
• The directors consider it inappropriate for the company to adopt
two particular aspects of the new/revised HKFRSs as these would
result in the financial statements, in the view of the directors,
either: • not reflecting the commercial substance of the business
or • being subject to significant potential short-term volatility,
as
explained below …….
3. Overall Consideration CaseCase
• HKAS 40 “Investment property” requires an assessment of the fair
value of investment properties.
• The group intends to follow the same accounting treatment as
adopted in 2004, which is to value such investment properties on an
annual basis.
• Accordingly, the investment properties were not revalued at 30
June 2005, since the directors consider that such change of
practice could introduce a significant element of short-term
volatility into the income statement in respect of assets which are
being held on a long-term basis by the group ……
• It is not practicable to estimate the financial effect of this
non- compliance as no interim valuation of the properties has been
conducted.
Interim Report 2005 clearly stated that:Interim Report 2005 clearly
stated that:
At year-end, revaluation would still be conducted.At year-end,
revaluation would still be conducted.
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3. Overall Consideration CaseCase
• HKAS 12 “Income Taxes”, together with HKAS-INT 21 “Income Taxes –
Recovery of Revalued Non-Depreciable Assets”, requires deferred
taxation to be recognised on any revaluation movements on
investment properties. • It is further provided that any such
deferred tax liability should be calculated
at the profits tax rate in the case of assets which the management
has no definite intention to sell.
• The company has not made such provision in respect of its HK
investment properties since the directors consider that such
provision would result in the financial statements not reflecting
the commercial substance of the business • since, should any such
sale eventuate, any gain would be regarded as capital
in nature and would not be subject to any tax in HK. • Should this
aspect of HKAS 12 have been adopted, deferred tax liabilities
amounting to HK$2,008 million on the revaluation surpluses arising
from revaluation of HK investment properties would have been
provided.
(estimate - over 12% of the net assets at 30 June 2005)
Interim Report 2005 clearly stated that:Interim Report 2005 clearly
stated that:
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3. Overall Consideration
• Departure but such departure is prohibited – In the extremely
rare circumstances in which
management concludes that • compliance with a requirement in
a
standard or an interpretation would be so misleading that
• it would conflict with the objective of financial statements set
out in the Framework
• but the relevant regulatory framework prohibits departure from
the requirement, the entity shall, to the maximum extent possible,
reduce the perceived misleading aspects of compliance by disclosing
……
a) Fair presentation and compliance with IFRSs
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3. Overall Consideration
– by disclosing: a) the title of the standard or interpretation
in
question, the nature of the requirement, and the reason why
management has concluded that complying with that requirement is so
misleading in the circumstances that it conflicts with the
objective of financial statements set out in the Framework;
and
b) for each period presented, the adjustments to each item in the
financial statements that management has concluded would be
necessary to give a fair presentation.
a) Fair presentation and compliance with IFRSs • Departure but such
departure is prohibited
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3. Overall Consideration
• When assessing whether complying with a specific requirement in a
standard or an interpretation would be so misleading that it would
conflict with the objective of financial statements set out in the
Framework – management considers:
a) why the objective of financial statements is not achieved in the
particular circumstances; and
b) how the entity’s circumstances differ from those of other
entities that comply with the requirement. – If other entities in
similar circumstances comply with the
requirement, » there is a rebuttable presumption that the entity’s
compliance
with the requirement would not be so misleading that it would
conflict with the objective of financial statements set out in the
Framework.
a) Fair presentation and compliance with IFRSs
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However, 2005 Final Results Announcement disclosed that • provision
for deferred tax was finally made
with regard to revaluation of the HK investment properties (total
HK$2.2 billion) at 2005 year-end.
However, However, 2005 Final Results Announcement2005 Final Results
Announcement disclosed that disclosed that •• provision for
deferred tax was finally made provision for deferred tax was
finally made
with regard to revaluation of the HK with regard to revaluation of
the HK investment properties (total HK$2.2 billion) at investment
properties (total HK$2.2 billion) at 2005 year2005
year--end.end.
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b) Going Concern
3. Overall Consideration
• When preparing financial statements, management shall make an
assessment of an entity’s ability to continue as a going
concern.
• Financial statements shall be prepared on a going concern basis –
unless management either intends to liquidate the entity or to
cease
trading, or has no realistic alternative but to do so. • When
management is aware, in making its assessment, of
material uncertainties related to events or conditions that may
cast significant doubt upon the entity’s ability to continue as a
going concern, those uncertainties shall be disclosed.
• When financial statements are not prepared on a going concern
basis, that fact shall be disclosed, together with the basis on
which the financial statements are prepared and the reason why the
entity is not regarded as a going concern.
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3. Overall Consideration
• An entity shall prepare its financial statements, except for cash
flow information, using the accrual basis of accounting.
• When the accrual basis of accounting is used, items are
recognised as assets, liabilities, equity, income and expenses –
when they satisfy the definitions and recognition criteria for
those
elements in the Framework.
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3. Overall Consideration
• The presentation and classification of items in the financial
statements shall be retained from one period to the next unless: a)
it is apparent,
• following a significant change in the nature of the entity’s
operations (e.g. significant acquisition or disposal) or
• a review of its financial statements, that another presentation
or classification would be more appropriate having regard to the
criteria for the selection and application of accounting policies
in IAS 8; or
b) a IFRS requires a change in presentation.
d) Consistency of presentation
An entity changes the presentation of its financial statements only
if – the changed presentation provides information that is reliable
and is
more relevant to users of the financial statements, and – the
revised structure is likely to continue, so that comparability is
not
impaired.
An entity changes the presentation of its financial statements only
if – the changed presentation provides information that is reliable
and is
more relevant to users of the financial statements, and – the
revised structure is likely to continue, so that comparability is
not
impaired.
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3. Overall Consideration
• Each material class of similar items shall be – presented
separately in the financial
statements. • Items of a dissimilar nature or function shall
be
– presented separately unless they are immaterial.
• Applying the concept of materiality means that a specific
disclosure requirement in a IFRS need not be satisfied if the
information is not material.
e) Materiality and Aggregation
What is the situation of recognition and measurement?
What is the What is the situation of situation of recognition and
recognition and measurement?measurement?
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material if they could, individually or collectively, influence the
economic decisions of users taken on the basis of the financial
statements.
– Materiality depends on the size and nature of the omission or
misstatement judged in the surrounding circumstances. • The size or
nature of the item, or a combination
of both, could be the determining factor.
e) Materiality and Aggregation
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3. Overall Consideration
• Assets and liabilities, and income and expenses, shall not be
offset – unless required or permitted by a IFRS.
• It is important that assets and liabilities, and income and
expenses, are reported separately. – Measuring assets net of
valuation allowances —
for example, obsolescence allowances on inventories and doubtful
debts allowances on receivables — is not offsetting.
f) Offsetting
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3. Overall Consideration
• During ordinary activities, some transactions that do not
generate revenue but are incidental to the main revenue-generating
activities. – The results of such transactions are presented,
when this presentation reflects the substance of the transaction or
other event, by netting any income with related expenses arising on
the same transaction.
f) Offsetting
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3. Overall Consideration
• For example: a) gains and losses on the disposal of
non-current
assets, including investments and operating assets, - are reported
by deducting from the proceeds on
disposal the carrying amount of the asset and related selling
expenses; and
b) expenditure related to a provision that is - recognised in
accordance with IAS 37 and - reimbursed under a contractual
arrangement with
a third party (for example, a supplier’s warranty agreement)
may be netted against the related reimbursement.
f) Offsetting
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3. Overall Consideration
• Gains and losses arising from a group of similar transactions are
reported on a net basis – For example,
• foreign exchange gains and losses or • gains and losses arising
on financial instruments held for trading.
• Such gains and losses are, however, reported separately if they
are material.
• Gains and losses arising from a group of similar transactions are
reported on a net basis – For example,
• foreign exchange gains and losses or • gains and losses arising
on financial instruments held for trading.
• Such gains and losses are, however, reported separately if they
are material.
Can foreign exchange gains and losses be offset?
ExampleExample
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3. Overall Consideration
• Except when a IFRS permits or requires otherwise, – comparative
information shall be disclosed in
respect of the previous period for all amounts reported in the
financial statements.
• When the presentation or classification of items in the financial
statements is amended, – comparative amounts shall be reclassified
unless
the reclassification is impracticable.
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Amended requirementsAmended requirements
3. Overall Consideration
• When comparative amounts are reclassified, an entity shall
disclose: a) the nature of the reclassification; b) the amount of
each item or class of items that is
reclassified; and c) the reason for the reclassification.
g) Comparative information
• In the past only the reason for and a description of the nature
of material reclassifications should be disclosed. Exemption for
disclosure of comparative information for the reconciliation of
movements in fixed assets is also removed
• In the past only the reason for and a description of the nature
of material reclassifications should be disclosed. Exemption for
disclosure of comparative information for the reconciliation of
movements in fixed assets is also removed
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3. Overall Consideration
Melco Development Limited () Notes to the financial statements for
year ended 31.12.2005 – Because HKAS 32 requires retrospective
application, comparative
figures for 2004 have been restated (see Note 2A for the financial
impact).
CaseCase
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Galaxy Entertainment Group Limited Notes to the financial
statements (y.e. 31.12.2005) – All changes in the accounting
policies require
retrospective application, except HKAS 39 and HKFRS 2 for which
transitional provisions are applied.
– As a result, the 2004 comparative figures have also been restated
or amended in accordance with the relevant requirements.
– The effects of all the changes in accounting policies are
summarised in notes (b) and (c) below.
CaseCase
• Identification of the financial statements • Reporting period •
Balance sheet
1. Current/Non-current distinction 2. Current assets 3. Current
liabilities 4. Information to be presented on the face of the
balance sheet 5. Information to be presented either on the face of
the balance sheet or in
the notes • Income statement
1. Profit or loss for the period 2. Information to be presented on
the face of the income statement 3. Information to be presented
either on the face of the income statement or
in the notes • Statement of changes in equity • Cash flow statement
• Notes
4. Structure and Content
• The financial statements shall be identified clearly and
distinguished from other information in the same published
document.
• The following information shall be displayed prominently, and
repeated when it is necessary for a proper understanding of the
information presented:
a) the name of the reporting entity or other means of
identification, and any change in that information from the
preceding balance sheet date;
b) whether the financial statements cover the individual entity or
a group of entities;
c) the balance sheet date or the period covered by the financial
statements, whichever is appropriate to that component of the
financial statements;
d) the presentation currency, as defined in HKAS 21 The Effects of
Changes in Foreign Exchange Rates; and
e) the level of rounding used in presenting amounts in the
financial statements.
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Identification of Financial Statements
• Can the units of the presentation currency be rounded to
thousands or millions?
• Financial statements are often made more understandable by
presenting information in thousands or millions of units of the
presentation currency.
• This is acceptable as long as – the level of rounding in
presentation is disclosed and – material information is not
omitted.
• Financial statements are often made more understandable by
presenting information in thousands or millions of units of the
presentation currency.
• This is acceptable as long as – the level of rounding in
presentation is disclosed and – material information is not
omitted.
ExampleExample
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• Financial statements shall be presented at least annually.
• When an entity’s balance sheet date changes and the annual
financial statements are presented for a period longer or shorter
than one year, an entity shall disclose, in addition to the period
covered by the financial statements: a) the reason for using a
longer or shorter period; and b) the fact that comparative amounts
for the income
statement, statement of changes in equity, cash flow statement and
related notes are not entirely comparable.
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Reporting Period
• Can a set of financial statements cover 52- week, instead of a
year?
• Normally, financial statements are consistently prepared covering
a one-year period.
• However, for practical reasons, some entities prefer to report,
for example, for a 52-week period.
• IAS 1 does not preclude this practice, because the resulting
financial statements are unlikely to be materially different from
those that would be presented for one year.
• Normally, financial statements are consistently prepared covering
a one-year period.
• However, for practical reasons, some entities prefer to report,
for example, for a 52-week period.
• IAS 1 does not preclude this practice, because the resulting
financial statements are unlikely to be materially different from
those that would be presented for one year.
ExampleExample
32
Current/Non-current Distinction
• An entity shall present – current and non-current assets, and –
current and non-current liabilities, as separate classifications on
the face of its balance sheet
• Except when a presentation based on liquidity provides
information – If that information is reliable and is more relevant
– When that exception applies, all assets and liabilities shall
be
presented broadly in order of liquidity
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Current/Non-current Distinction
• Whichever method of presentation is adopted, for each asset and
liability line item that combines amounts expected to be recovered
or settled a) no more than 12 months after the balance sheet
date
and b) more than 12 months after the balance sheet date, (i.e.
combines both current and non-current)
an entity shall disclose the amount expected to be recovered or
settled after more than 12 months.
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Current Assets
• An asset shall be classified as current when it satisfies any of
the following criteria: a) it is expected to be realised in, or is
intended for sale or
consumption in, the entity’s normal operating cycle; b) it is held
primarily for the purpose of being traded; c) it is expected to be
realised within 12 months after the balance
sheet date; or d) it is cash or a cash equivalent
• unless it is restricted from being exchanged or used to settle a
liability for at least 12 months after the balance sheet
date.
• All other assets shall be classified as non-current.
Examples: • Deposits pledged to bank (how long?) • Fixed deposits
over 1 year maturity
Examples: • Deposits pledged to bank (how long?) • Fixed deposits
over 1 year maturity
What is it?What is it?
© 2005-07 Nelson 66
• What is operating cycle?
• The operating cycle of an entity is the time between – the
acquisition of assets for processing and – their realisation in
cash or cash equivalents.
• When the entity’s normal operating cycle is not clearly
identifiable, – its duration is assumed to be 12 months.
• The operating cycle of an entity is the time between – the
acquisition of assets for processing and – their realisation in
cash or cash equivalents.
• When the entity’s normal operating cycle is not clearly
identifiable, – its duration is assumed to be 12 months.
ExampleExample
34
Current Assets
• Can a non-current asset reclassified if it fulfil the definition
of current asset later?
• Assets classified as non-current in accordance with IAS 1 shall
not be reclassified as current assets – until they meet the
criteria to be classified as held for sale in
accordance with IFRS 5 • Assets of a class that an entity would
normally regard as non-
current that are acquired exclusively with a view to resale shall
not be classified as current – unless they meet the criteria to be
classified as held for sale in
accordance with IFRS 5
• Assets classified as non-current in accordance with IAS 1 shall
not be reclassified as current assets – until they meet the
criteria to be classified as held for sale in
accordance with IFRS 5 • Assets of a class that an entity would
normally regard as non-
current that are acquired exclusively with a view to resale shall
not be classified as current – unless they meet the criteria to be
classified as held for sale in
accordance with IFRS 5
No non-current assets can be classified as current unless the
criteria in IFRS 5 are fulfilled, mainly • Available for immediate
sale • Highly probable to make the sale
35
Current Assets
• In its 2005 Interim Report, full set of HKFRS was adopted and the
report set out that: – Available-for-sale financial assets are
non-
derivatives that are either • designated in this category or • not
classified in any of the other categories (i.e.
loans and receivables, financial assets at fair value through
profit or loss and held-to-maturity investments).
CaseCase
Similar in 2005 Annual Report
Similar in 2005 Annual Report
– They are included in non-current assets • unless management
intends to dispose of the
investment within 12 months of the balance sheet date.
© 2005-07 Nelson 70
New requirementsNew requirements
Current Liabilities
• A liability shall be classified as current when it satisfies any
of the following criteria: a) it is expected to be settled in the
entity’s normal operating cycle; b) it is held primarily for the
purpose of being traded; c) it is due to be settled within 12
months after the balance sheet
date; or d) the entity does not have an unconditional right to
defer settlement
of the liability for at least 12 months after the balance sheet
date.
• All other liabilities shall be classified as non-current.
ImplicationImplication
36
© 2005-07 Nelson 71
Current Liabilities Revised rules on classifying a liability as
current or non-current • A liability held for being traded ⇒
current • A financial liability due within 12 months after the B/S
date ⇒ current
– even if an agreement to refinance on a long-term basis is
completed after the B/S date (only disclosed as non-adjusting
event)
• If an entity has discretion to refinance ⇒ non-current • If an
entity without discretion to refinance ⇒ current
• A non-current financial liability is payable on demand with a
breach on a condition of its loan agreement on or before the B/S
date – If the lender agreed not to demand payment
• after the B/S date ⇒ current (only disclosed as non-adjusting
event)
• by the B/S date ⇒ non-current
ImplicationImplication
Note 12 to Interim Report 2006 • Breach of loan covenants
• As at 30 June 2006, in respect of certain bank loans with an
aggregate carrying amount of HK$1,529,806,000, the Group breached
certain financial covenants of the banks loans.
• Since the lenders have not agreed to waive its right to demand
immediate payment as at the balance sheet date, the loans have been
classified as current liabilities in these financial statements at
30 June 2006.
37
Current Assets and Liabilities ExampleExample
Can the following be classified as current assets? • 3-month fixed
deposits pledged to a bank to secure
a mortgage loan of 5 years • 2-year fixed deposits with a
bank
Can the following be classified as current assets? • 3-month fixed
deposits pledged to a bank to secure
a mortgage loan of 5 years • 2-year fixed deposits with a
bank
Can the following be classified as non-current liabilities? •
5-year term loan matured after year end but renewed
for another 5 years after year end (before the issuance of the
financial statements)
• 2-year term loan to be matured with 12 months and the entity has
a right to renew for another 2 years
Can the following be classified as non-current liabilities? •
5-year term loan matured after year end but renewed
for another 5 years after year end (before the issuance of the
financial statements)
× ×
×
√
© 2005-07 Nelson 74
Balance Sheet • As a minimum, the face of the balance sheet
shall
include line items that present the following amounts: a) property,
plant and equipment; b) investment property; c) intangible assets;
d) financial assets (excl. amounts shown under (e), (h) and (I));
e) investments accounted for using the equity method; f) biological
assets; g) inventories; h) trade and other receivables; i) cash and
cash equivalents; j) trade and other payables; k) provisions; l)
financial liabilities (excl. amounts shown under (j) and (k)); m)
liabilities and assets for current tax, as defined in HKAS 12
Income Taxes; n) deferred tax liabilities and deferred tax assets,
as defined in HKAS 12; o) minority interest, presented within
equity; and p) issued capital and reserves attributable to equity
holders of the parent.
38
© 2005-07 Nelson 75
Balance Sheet • The face of the balance sheet shall also include
line
items that present the following amounts: a) The total of assets
classified as held for sale and
assets included in disposal groups classified as held for sale in
accordance with IFRS 5 Non-current Assets Held for Sale and
Discontinued Operations; and
b) Liabilities included in disposal groups classified as held for
sale in accordance with IFRS 5
© 2005-07 Nelson 76
Balance Sheet • Additional line items, headings and subtotals
shall
be presented on the face of the balance sheet when such
presentation is relevant to an understanding of the entity’s
financial position.
• When an entity presents current and non-current assets, and
current and non-current liabilities, as separate classifications on
the face of its balance sheet, – it shall not classify deferred tax
assets
(liabilities) as current assets (liabilities).
39
Balance Sheet
• The use of different measurement bases for different classes of
assets suggests that their nature or function differs and,
therefore, that they should be presented as separate line items. –
For example, different classes of property, plant and
equipment can be carried at • Cost, or • Revalued amounts in
accordance with IAS 16 PPE.
In the past, it use “may need” In the past, it use “may need”
© 2005-07 Nelson 78
Galaxy Entertainment Group Limited Consolidated balance sheet as at
31.12.2005
CaseCase
40
CaseCase
© 2005-07 Nelson 80
Income Statement Minimum requirements on the face of the income
statement • As a minimum, the face of the income statement shall
include line items
that present the following amounts for the period: a) revenue; b)
finance costs; c) share of the profit or loss of associates and
joint ventures accounted
for using the equity method; d) pre-tax gain or loss recognised on
the disposal of assets or
settlement of liabilities attributable to discontinuing operations;
e) tax expense; and f) profit or loss.
41
© 2005-07 Nelson 81
Income Statement • The following items shall be disclosed on the
face of the income
statement as allocations of profit or loss for the period: a)
Profit or loss attributable to minority interest, and b) Profit or
loss attributable to equity holders of the parent
A similar requirement has been added for the statement of changes
in equity and such allocated amounts are not to be presented as
items of income or expense
© 2005-07 Nelson 82
CaseCase
42
Income Statement • Not require to disclose the results of
operating
activities as a line item on the face of the income statement
• An entity shall not present any items of income and expense as
extraordinary items, either on the face of the income statements or
in the notes
Entities can’t use itEntities can’t use it
Entities can still show itEntities can still show it
© 2005-07 Nelson 84
Income Statement Either on the face of the income statement or in
the notes: • An entity shall present an analysis of expenses using
a classification
based on either • the nature of expenses or • their function within
the entity,
whichever provides information that is reliable and more
relevant
• Entities classifying expenses by function shall disclose
additional information on the nature of expenses, including •
depreciation and amortisation expense and • employee benefits
expense.
43
© 2005-07 Nelson 86
Statement of Changes in Equity • An entity shall present a
statement of changes in equity showing on the
face of the statement: a) profit or loss for the period; b) each
item of income and expense for the period that, as required
by
IFRSs, is recognised directly in equity, and the total of these
items; c) total income and expense for the period (calculated as
the sum of (a) and
(b)), showing separately the total amounts attributable • to equity
holders of the parent and • to minority interest; and
d) for each component of equity, the effects of changes in
accounting policies and corrections of errors recognised in
accordance with IAS 8.
Any Change?Any Change?
A revised requirement: • A statement of changes in equity that
comprises only these items
shall be titled a statement of recognised income and expenses
A revised requirement: • A statement of changes in equity that
comprises only these items
shall be titled a statement of recognised income and expenses
44
© 2005-07 Nelson 87
Statement of Changes in Equity • An entity shall also present,
either on the face of the
statement of changes in equity or in the notes: a) the amounts of
transactions with equity holders acting in
their capacity as equity holders, showing separately distributions
to equity holders;
b) the balance of retained earnings (ie accumulated profit or loss)
at the beginning of the period and at the balance sheet date, and
the changes during the period; and
c) a reconciliation between the carrying amount of each class of
contributed equity and each reserve at the beginning and the end of
the period, separately disclosing each change.
© 2005-07 Nelson 88
CaseCase
45
Notes Structure (an entity is required to disclose the
following)
• The notes shall: a) present information about the basis of
preparation of the financial statements
and the specific accounting policies used; b) disclose the
information required by HKFRSs that is not presented on the
face of the balance sheet, income statement, statement of changes
in equity or cash flow statement; and
c) provide additional information that is not presented on the face
of the balance sheet, income statement, statement of changes in
equity or cash flow statement, but is relevant to an understanding
of any of them.
• Notes shall, as far as practicable, be presented in a systematic
manner. • Each item on the face of the balance sheet, income
statement, statement
of changes in equity and cash flow statement shall be
cross-referenced to any related information in the notes.
© 2005-07 Nelson 90
Notes Disclosures (an entity is required to disclose the
following)
• Disclosure of accounting policies: An entity shall disclose in
the summary of significant accounting policies: a) the measurement
basis (or bases) used in preparing the financial
statements; and b) the other accounting policies used that are
relevant to an understanding of
the financial statements.
Galaxy Entertainment Group Limited Notes to the financial statement
(y.e. 31.12.2005) – The financial statements have been prepared
in
accordance with Hong Kong Financial Reporting Standards (‘‘HKFRS’’)
issued by the Hong Kong Institute of Certified Public Accountants •
under the historical cost convention as modified by the
revaluation of investment properties, available-for-sale financial
assets, derivative financial instruments and other investments,
which are carried at fair values ……
– The principal accounting policies applied in the preparation of
these financial statements are set out below. These policies have
been consistently applied to all the years presented, except for
those stated in note 2(a) above.
© 2005-07 Nelson 92
Notes Disclosures (an entity is required to disclose the
following)
• Disclosure of accounting policies – The judgements, apart from
those involving estimations, management has
made • in the process of applying the entity’s accounting policies
that have the
most significant effect on the amounts recognised in the financial
statements (in the summary of significant accounting policies or
other notes)
Examples – Management makes judgements in determining: a) whether
financial assets are held-to-maturity investments; b) when
substantially all the significant risks and rewards of
ownership of financial assets and lease assets are transferred to
other entities;
c) whether, in substance, particular sales of goods are financing
arrangements and therefore do not give rise to revenue; and
d) whether the substance of the relationship between the entity and
a special purpose entity indicates that the special purpose entity
is controlled by the entity.
Examples – Management makes judgements in determining: a) whether
financial assets are held-to-maturity investments; b) when
substantially all the significant risks and rewards of
ownership of financial assets and lease assets are transferred to
other entities;
c) whether, in substance, particular sales of goods are financing
arrangements and therefore do not give rise to revenue; and
d) whether the substance of the relationship between the entity and
a special purpose entity indicates that the special purpose entity
is controlled by the entity.
47
Notes Disclosures (an entity is required to disclose the
following)
• Key sources of estimation uncertainty – Information about the key
assumptions concerning the future, and
other key sources of estimation uncertainty at the balance sheet
date, • that have a significant risk of causing a material
adjustment to the
carrying amounts of assets and liabilities within the next
financial year – In respect of those assets and liabilities, the
notes shall include details of:
a) their nature; and b) their carrying amount as at the balance
sheet date
Examples – in the absence of recently observed market prices used
to measure the following assets and liabilities, future-oriented
estimates are necessary to measure: • the recoverable amount of
classes of PPE • the effect of technological obsolescence on
inventories
Estimates involve assumptions about such items as • the risk
adjustment to cash flows or discount rates used • future changes in
salaries and in prices affecting other costs.
Examples – in the absence of recently observed market prices used
to measure the following assets and liabilities, future-oriented
estimates are necessary to measure: • the recoverable amount of
classes of PPE • the effect of technological obsolescence on
inventories
Estimates involve assumptions about such items as • the risk
adjustment to cash flows or discount rates used • future changes in
salaries and in prices affecting other costs.
© 2005-07 Nelson 94
Esprit Holdings LimitedEsprit Holdings Limited • Critical
Accounting Estimates and Judgements
– Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
– Critical accounting estimates and assumptions • The Group makes
estimates and assumptions concerning
the future. The resulting accounting estimates will, by definition,
seldom equal the related actual results.
• The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below ……
(including (1) useful life and impairment of trademarks and (2)
income taxes)
CaseCase
48
Notes
Melco Development Limited () Notes to the financial statements for
the year ended 31.12.2005 – The key assumptions concerning the
future, and other key sources
of estimation uncertainty at the balance sheet date, that have a
significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year,
are discussed below …… (The issues discussed include: • Allowances
for inventories • Estimated impairment of goodwill Income
taxes)
CaseCase
Galaxy Entertainment Group Limited Notes to the financial statement
(y.e. 31.12.2005) – Estimates and judgements used in preparing
the
financial statements are continually evaluated and are based on
historical experience and other factors, including expectations of
future events that are believed to be reasonable under the
circumstances.
– The Group makes estimates and assumptions concerning the
future.
– The resulting accounting estimates will, by definition, seldom
equal the related actual results.
– The estimates and assumptions that have a significant effect on
the carrying amounts of assets and liabilities are discussed below
….. (including impairment of goodwill, impairment of gaming
licence, Useful lives of property, plant and equipment, fair value
of investment properties …..)
49
Notes Disclosures (an entity is required to disclose the
following)
• Other disclosures An entity shall disclose in the notes: a) the
amount of dividends proposed or declared before the
financial statements were authorised for issue but not recognised
as a distribution to equity holders during the period, and the
related amount per share (HK incorporated companies are required to
show the aggregate amount which is recommended for distribution by
way of dividend under a separate heading(s) in their balance sheet
(HK Co. Ord. 10th Sch., para 9(1)(e)); and
b) the amount of any cumulative preference dividends not
recognised.
© 2005-07 Nelson 98
Notes Disclosures (an entity is required to disclose the
following)
An entity shall disclose the following, if not disclosed elsewhere
in information published with the financial statements: a) the
domicile and legal form of the entity,
its country of incorporation and the address of its registered
office (or principal place of business, if different from the
registered office);
b) a description of the nature of the entity’s operations and its
principal activities; and
c) the name of the parent and the ultimate parent of the
group.
“shall disclose” now, instead of “encouraged to disclose”
“shall disclose” now, instead of “encouraged to disclose”
• Other disclosures
Galaxy Entertainment Group Limited Notes to the financial statement
(y.e. 31.12.2005) • The principal activities of Galaxy
Entertainment Group
Ltd. (the ‘‘Company’’) (formerly known as K. Wah Construction
Materials Ltd.) and its subsidiaries (together the ‘‘Group’’) are
to – operate in casino games of chance or games of other
forms
in Macau, (and) manufacture, sale and distribution of construction
materials in HK, Macau and Mainland China.
• The Company is – a limited liability company incorporated in Hong
Kong and – has its listing on the Main Board of The Stock Exchange
of
Hong Kong Limited. • The address of its registered office and its
principal place
of business is Room 1606, 16th Floor, Hutchison House, 10 Harcourt
Road, Central, HK.
© 2005-07 Nelson 100
Effective Date
• An entity shall apply IAS 1 for annual periods beginning on or
after 1 Jan. 2005.
– Earlier application is encouraged. – If an entity applies IAS 1
for an earlier period, it shall
disclose this fact. • For the amendments relating to the Statement
of
Changes in Equity – An entity shall apply it for annual periods
beginning on
or after 1 Jan. 2006. – If an entity applies the amendments to IAS
19
Employee Benefits – Actuarial Gains and Losses, Group Plans and
Disclosures for an earlier period, that amendment shall be applied
for that earlier period.
51
© 2005-07 Nelson 102
CapitalCapital AssetsAssets LiabilitiesLiabilities= –
• IAS 1.BC47 considers “whether an entity can have a view of
capital that differs from what IFRSs define as equity.”
• It further clarifies that, although for the purposes of this
disclosure capital would often equate with equity as defined in
IFRSs, – it might also include or exclude some components.
• It also noted that the capital disclosure in IAS 1 is intended to
give entities the opportunity to describe – how they view the
components of capital they manage, if this is
different from what IFRSs define as equity ……
© 2005-07 Nelson 104
EquityEquityEquity AssetsAssets LiabilitiesLiabilities= –
Based on the Framework & IFRSs, the accounting equation should
be:
CapitalCapital AssetsAssets LiabilitiesLiabilities= –
• An entity’s capital may be part of its equity plus part of its
liabilities, depending on how it manage “its capital” ……
53
Capital Disclosures
• An entity shall disclose information that enables users of its
financial statements to evaluate – the entity’s objectives,
policies and processes for managing capital.
• To comply with the capital disclosures, the entity discloses the
following: a) qualitative information about its objectives,
policies and processes for
managing capital, including (but not limited to): i) a description
of what it manages as capital; ii) when an entity is subject to
externally imposed capital requirements,
the nature of those requirements and how those requirements are
incorporated into the management of capital; and
iii) how it is meeting its objectives for managing capital.
• To comply with the capital disclosures, the entity discloses the
following: a) qualitative information about its objectives,
policies and processes for
managing capital, including (but not limited to): i) a description
of what it manages as capital; ii) when an entity is subject to
externally imposed capital requirements,
the nature of those requirements and how those requirements are
incorporated into the management of capital; and
iii) how it is meeting its objectives for managing capital.
© 2005-07 Nelson 106
Example disclosure • The Group’s objectives when managing capital
are:
– to safeguard the entity’s ability to continue as a going
concern,
• so that it can continue to provide returns for shareholders and
benefits for other stakeholders, and
– to provide an adequate return to shareholders by pricing products
and services commensurately with the level of risk.
• The Group sets the amount of capital in proportion to risk.
ExampleExample
ObjectivesObjectives
54
Capital Disclosures
• The Group manages the capital structure and makes adjustments to
it in the light of – changes in economic conditions and – the risk
characteristics of the underlying assets.
• In order to maintain or adjust the capital structure, the Group
may – adjust the amount of dividends paid to shareholders, – return
capital to shareholders, – issue new shares, or – sell assets to
reduce debt.
ExampleExample
Capital Disclosures
• Consistently with others in the industry, the Group monitors
capital on the basis of – the debt-to-adjusted capital ratio.
• This ratio is calculated as net debt ÷ adjusted capital.
ExampleExample
HowHow
• Net debt is calculated as – Total debt (as shown in the
balance sheet) – Less: cash & cash equivalents
• Net debt is calculated as – Total debt (as shown in the
balance sheet) – Less: cash & cash equivalents
• Adjusted capital – comprises all components of
equity (i.e. share capital, share premium, minority interest,
retained earnings, and revaluation reserve) – other than
amounts
recognised in equity relating to cash flow hedges, and
– includes some forms of subordinated debt.
• Adjusted capital – comprises all components of
equity (i.e. share capital, share premium, minority interest,
retained earnings, and revaluation reserve) – other than
amounts
recognised in equity relating to cash flow hedges, and
– includes some forms of subordinated debt.
55
Capital Disclosures
• An entity shall disclose information that enables users of its
financial statements to evaluate – the entity’s objectives,
policies and processes for managing capital.
• To comply with the capital disclosures, the entity discloses the
following:
• To comply with the capital disclosures, the entity discloses the
following: b) summary quantitative data about what it manages as
capital.
Some entities regard some financial liabilities (e.g. some forms of
subordinated debt) as part of capital. Other entities regard
capital as excluding some components of equity (e.g. components
arising from cash flow hedges).
c) any changes in (a) and (b) from the previous period.
© 2005-07 Nelson 110
ExampleExample
• During 20X4, the Group’s strategy, which was unchanged from 20X3,
was to maintain the debt-to-adjusted capital ratio at the lower end
of the range 6:1 to 7:1, in order to secure access to finance at a
reasonable cost by maintaining a BB credit rating. The
debt-to-adjusted capital ratios at 31 December 20X4 and at 31
December 20X3 were as follows:
31.12.X4 ($’M) 31.12.X3 ($’M) Total debt 1,000 1,100 Less: cash and
cash equivalents (90) (150) Net debt 910 950
Total equity 110 105 Add: subordinated debt instruments 38 38 Less:
amounts recognised in equity
relating to cash flow hedges (10) (5) Adjusted capital 138
138
Debt-to-adjusted capital ratio 6.6 6.9
56
Capital Disclosures
• An entity shall disclose information that enables users of its
financial statements to evaluate – the entity’s objectives,
policies and processes for managing capital.
• To comply with the capital disclosures, the entity discloses the
following:
• To comply with the capital disclosures, the entity discloses the
following: d) whether during the period it complied with any
externally imposed capital
requirements to which it is subject. e) when the entity has not
complied with such externally imposed capital
requirements, the consequences of such non-compliance. These
disclosures shall be based on the information provided internally
to the entity’s key management personnel.
© 2005-07 Nelson 112
Capital Disclosures ExampleExample
Example disclosure • Entity A filed its quarterly regulatory
capital return for
30 September 20X7 on 20 October 20X7. • At that date, Entity A’s
regulatory capital was below
the capital requirement imposed by Regulator B by $1 million.
• As a result, Entity A was required to submit a plan to the
regulator indicating how it would increase its regulatory capital
to the amount required.
• Entity A submitted a plan that entailed selling part of its
unquoted equities portfolio with a carrying amount of $11.5 million
in the fourth quarter of 20X7.
• In the fourth quarter of 20X7, Entity A sold its fixed interest
investment portfolio for $12.6 million and met its regulatory
capital requirement.
For example, SFC or banks
For example, SFC or banks
57
© 2005-07 Nelson 113
Capital Disclosures CaseCase
• Early adopted capital disclosure in 2005 and its annual report
states that (extract only): – The Group’s objectives when managing
capital are:
• To safeguard the Group’s ability to continue as a going concern,
so that it continues to provide returns for shareholders and
benefits for other stakeholders;
• To support the Group’s stability and growth; and • To provide
capital for the purpose of strengthening the
Group’s risk management capability.
© 2005-07 Nelson 114
Capital Disclosures CaseCase
– The Group actively and regularly reviews and manages its capital
structure to ensure optimal capital structure and shareholder
returns, taking into consideration the future capital requirements
of the Group and capital efficiency ……
– The Group adopts a dividend policy …… while retaining 10 per cent
of the profit as capital of the Group for future use.
– The Group has set aside $1,500 million of retained earnings for
the purpose of strengthening the risk management regime of the
clearing houses and supporting their roles as central
counterparties.
– As in prior years, the Group monitors capital by reviewing the
level of capital that is at the disposal of the Group (“adjusted
capital”). Adjusted capital comprises all components of
shareholders’ equity other than the hedging reserve relating to
cash flow hedges, designated reserves and investment revaluation
reserve ……
• Early adopted capital disclosure in 2005 and its annual report
states that (extract only):
58
• An entity shall apply the requirements of capital disclosure
for
– annual periods beginning on or after 1 January 2007.
• Early application is encouraged.
59
Framework and IAS 1 March 2007
Nelson LamNelson Lam
[email protected]
www.nelsoncpa.com.hk
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/GrayImageDict << /QFactor 0.15 /HSamples [1 1 1 1] /VSamples
[1 1 1 1] >> /JPEG2000GrayACSImageDict << /TileWidth
256 /TileHeight 256 /Quality 30 >> /JPEG2000GrayImageDict
<< /TileWidth 256 /TileHeight 256 /Quality 30 >>
/AntiAliasMonoImages false /DownsampleMonoImages true
/MonoImageDownsampleType /Bicubic /MonoImageResolution 1200
/MonoImageDepth -1 /MonoImageDownsampleThreshold 1.50000
/EncodeMonoImages true /MonoImageFilter /CCITTFaxEncode
/MonoImageDict << /K -1 >> /AllowPSXObjects false
/PDFX1aCheck false /PDFX3Check false /PDFXCompliantPDFOnly false
/PDFXNoTrimBoxError true /PDFXTrimBoxToMediaBoxOffset [ 0.00000
0.00000 0.00000 0.00000 ] /PDFXSetBleedBoxToMediaBox true
/PDFXBleedBoxToTrimBoxOffset [ 0.00000 0.00000 0.00000 0.00000 ]
/PDFXOutputIntentProfile () /PDFXOutputCondition ()
/PDFXRegistryName (http://www.color.org) /PDFXTrapped /Unknown
/Description << /FRA
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/ENU (Use these settings to create PDF documents with higher image
resolution for improved printing quality. The PDF documents can be
opened with Acrobat and Reader 5.0 and later.) /JPN
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/DEU
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/PTB
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/DAN
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/NLD
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/ESP
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/SUO
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/ITA
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/NOR
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/SVE
<FEFF0041006e007600e4006e00640020006400650020006800e4007200200069006e0073007400e4006c006c006e0069006e006700610072006e00610020006e00e40072002000640075002000760069006c006c00200073006b0061007000610020005000440046002d0064006f006b0075006d0065006e00740020006d006500640020006800f6006700720065002000620069006c0064007500700070006c00f60073006e0069006e00670020006f006300680020006400e40072006d006500640020006600e50020006200e400740074007200650020007500740073006b00720069006600740073006b00760061006c0069007400650074002e0020005000440046002d0064006f006b0075006d0065006e00740065006e0020006b0061006e002000f600700070006e006100730020006d006500640020004100630072006f0062006100740020006f00630068002000520065006100640065007200200035002e003000200065006c006c00650072002000730065006e006100720065002e>
>> >> setdistillerparams << /HWResolution [2400
2400] /PageSize [612.000 792.000] >> setpagedevice