Month: February 2021

 OBJECTIVE To outline the accounting treatment for intangible assets that are not dealt with specifically in another standard.            EXCLUSIONS IAS 38 does not apply to: Intangible assets that are within the scope of another standard Read More …

OBJECTIVE To outline the accounting treatment for investment properties and the disclosure requirements.                  EXCLUSIONS The standard does not apply to: Biological assets related to agricultural activity Mineral rights and reserves     Read More …

INTRODUCTION  Leasing represents a very common and important method of acquiring non-current assets.  A lease can offer very significant cash flow advantages, as the payment of the full cost of an asset on acquisition is avoided. Under a lease agreement, Read More …

INTRODUCTION IAS 20 sets out the accounting procedures to be followed when dealing with government grants.  It also outlines the disclosure requirements necessary upon receipt of such grants. The standard recognises that government assistance can come in a variety of Read More …

DEFINITION Borrowing costs are interest and other costs incurred by an entity in connection with the borrowing of funds.  They may include, for example: Interest on bank overdrafts, short-term and long-term loans Amortisation of discounts or premiums related to borrowing Read More …

OBJECTIVE The objective of IAS 16 is to prescribe the accounting treatment for property, plant and equipment, so that users of the financial statements can understand the nature of the entities investment in such assets and any changes that have Read More …

INTRODUCTION IAS 1 (Revised) was published in September 2007. It introduced a number of changes, the main ones being as follows: The titles of the main financial statements were amended to Statement of Changes in Position, Statement of Comprehensive Income Read More …

STRUCTURE OF THE IASC FOUNDATION  In 1999, in a move that reflected the growing importance of international accounting standards, the board of the International Accounting Standards Board (IASB) recommended and later adopted a new constitution and structure. As a result, Read More …

COST ACCOUNTING SYSTEMS  The Principle of Double Entry In some businesses, the cost accounts may consist of little more than statistical memoranda, but in a business of any size or complexity, it is preferable for the cost accounts to be Read More …

FUNCTIONAL BUDGETS  Sample Data VT Ltd produces two products – X and Y.  The products pass through two departments – Department 1 and Department 2.  The following standards have been prepared for direct materials and direct wages: Sales Budget The Read More …