CONTENTS

Cover

Series Page

Title Page

About the Authors

Chapter 1: Introduction to International Financial Reporting Standards

Introduction
Origins and Early History of the IASB
The Current Structure
Process of IFRS Standard Setting
Convergence: The IASB and Financial Reporting in the US
The IASB and Europe
Appendix A: Current International Financial Reporting Standards (IAS/IFRS) and Interpretations (SIC/IFRIC)
Appendix B: Projects Completed Since Previous Issue (July 2016 to June 2017)
Appendix C: IFRS for SMEs

Chapter 2: Conceptual Framework

Introduction
Conceptual Framework for Financial Reporting 2010
Conceptual Framework Project
Hierarchy of Standards
IFRS Practice Statement Management Commentary
US GAAP Comparison

Chapter 3: Presentation of Financial Statements

Introduction
Scope
Definitions of Terms
Financial Statements
General Features
Structure and Content
Future Developments
Illustrative Financial Statements
US GAAP Comparison

Chapter 4: Statement of Financial Position

Introduction
Scope
Definitions of Terms
General Concepts, Structure and Content
Classification of Assets
Classification of Liabilities
Classification of Shareholders' Equity
Future Developments
US GAAP Comparison

Chapter 5: Statements of Profit or Loss and Other Comprehensive Income, and Changes in Equity

Introduction
Future Developments
Scope
Definitions of Terms
Concepts of Income
Recognition and Measurement
Statement of Profit or Loss and Other Comprehensive Income
Presentation in the Profit or Loss Section
Other Comprehensive Income
Statement of Changes in Equity
US GAAP Comparison

Chapter 6: Statement of Cash Flows

Introduction
Scope
Definitions of Terms
Background
Presentation
Other Requirements
Disclosure and Examples
Consolidated Statement of Cash Flows
US GAAP Comparison

Chapter 7: Accounting Policies, Changes in Accounting Estimates, and Errors

Introduction
Scope
Definitions of Terms
Importance of Comparability and Consistency in Financial Reporting
Accounting Policy
Selecting Accounting Policies
Changes in Accounting Policies
Changes in Accounting Estimates
Correction of Errors
Future Developments
US GAAP Comparison

Chapter 8: Inventories

Introduction
Definitions of Terms
Recognition and Measurement
Methods of Inventory Costing Under IAS 2
Examples of Financial Statement Disclosures
US GAAP Comparison

Chapter 9: Property, Plant and Equipment

Introduction
Definitions of Terms
Recognition and Measurement
Derecognition
Disclosures
Examples of Financial Statement Disclosures
US GAAP Comparison

Chapter 10: Borrowing Costs

Introduction
Definitions of Terms
Recognition and Measurement
Future Development
US GAAP Comparison

Chapter 11: Intangible Assets

Introduction
Scope
Definitions of Terms
Recognition and Measurement
Disclosures
Example of Financial Statement Disclosure
US GAAP Comparison

Chapter 12: Investment Property

Introduction
Definitions lOf Terms
Identification
Recognition and Measurement
Presentation and Disclosure
Examples of Financial Statement Disclosures
US GAAP Comparison

Chapter 13: Impairment of Assets and Non-Current Assets Held for Sale

Introduction
Definitions of Terms: Impairment of Assets
Impairment of Assets (IAS 36)
Examples of Financial Statement Disclosures
Definitions of Terms: Non-Current Assets Held for Sale
Non-Current Assets Held for Sale
Discontinued Operations
Examples of Financial Statement Disclosures
US GAAP Comparison

Chapter 14: Consolidations, Joint Arrangements, Associates and Separate Financial Statements

Introduction
Definitions of Terms
Consolidated Financial Statements
Examples of Financial Statement Disclosures
Joint Arrangements
Associates
Equity Method of Accounting
Examples of Financial Statement Disclosures
Separate Financial Statements
Disclosure Requirements
Transition Guidance
US GAAP Comparison

Chapter 15: Business Combinations

Introduction
Definitions of Terms
Business Combinations and Consolidations
Business Combinations
Disclosure Requirements
Examples of Financial Statement Disclosures
Future Developments
US GAAP Comparison

Chapter 16: Shareholders' Equity

Introduction
Definitions of Terms
Recognition and Measurement
Presentation and Disclosure
Classification Between Liabilities and Equity
Share Issuances and Related Matters
Examples of Financial Statement Disclosures
US GAAP Comparison

Chapter 17: Share-Based Payment

Introduction
Scope
Definitions of Terms
Overview
Recognition and Measurement
Equity-Settled Share-Based Payments
Cash-Settled Share-Based Payments
Share-Based Payment Transactions with Cash Alternatives
Share-Based Transactions Among Group Entities
Disclosure
Examples of Financial Statement Disclosures
US GAAP Comparison
Appendix: Employee Share Options Valuation Example

Chapter 18: Current Liabilities, Provisions, Contingencies and Events After the Reporting Period

Introduction
Definitions of Terms
Recognition and Measurement
Disclosures
Practical Examples
Reporting Events Occurring after the Reporting Period
Examples of Financial Statement Disclosures
Future Developments
US GAAP Comparison

Chapter 19: Employee Benefits

Introduction
Definitions of Terms
Background
Basic Principles of IAS 19
Post-Employment Benefit Plans
Employer's Liability and Assets
Minimum Funding Requirement
Other Pension Considerations
Disclosures for Post-Employment Benefit Plans
Examples of Financial Statement Disclosures
Other Employee Benefits
Future Developments
US GAAP Comparison

Chapter 20: Revenue from Contracts with Customer

Introduction
Definitions of Terms
Scope
The Revenue Model
Contract Cost
Presentation
Disclosure
Specific Transactions
Example of Financial Statement Disclosures
US GAAP Comparison

Chapter 21: Government Grants

Introduction
Scope
Definitions of Terms
Recognition of Government Grants
Presentation and Disclosure
Other Issues
Service Concessions
US GAAP Comparison

Chapter 22: Leases

Introduction
Definitions of Terms
Classification of Leases
Recognition and Measurement
Disclosure Requirements Under IAS 17
Examples of Financial Statement Disclosures
Future Developments
US GAAP Comparison
Appendix A: Special Situations Not Addressed by IAS 17 but which have been Interpreted Under US GAAP
Appendix B: Leveraged Leases Under US GAAP

Chapter 23: Foreign Currency

Introduction
Definitions of Terms
Scope, Objectives and Discussion of Definitions
Foreign Currency Transactions
Translation of Foreign Currency Financial Statements
Guidance Applicable to Special Situations
Disclosure
Hedging
Examples of Financial Statement Disclosures
US GAAP Comparison

Chapter 24: Financial Instruments

Introduction
Definitions of Terms
Recognition, Measurement and Derecognition of Financial Instruments
Financial Liabilities
Subsequent Measurement of Financial Liabilities
Embedded Derivatives
Financial Instruments Measured at Amortised Cost
Fair Valuation Gains and Losses
Impairment of Financial Instruments
Hedge Accounting
Effective Date and Transition Requirements of IFRS 9
Presentation of Financial Instruments Under IAS 32
Disclosures

Chapter 25: Fair Value

Introduction
Scope
Definitions of Terms
Fair Value Measurement Principles and Methodologies
Fair Value Disclosure
Education Material
Future Developments
US GAAP Comparison

Chapter 26: Income Taxes

Introduction
Scope
Definitions of Terms
Identification
Recognition and Measurement of Current Tax
Recognition and Measurement of Deferred Tax
Recognition in Profit or Loss
Calculation of Deferred Tax Asset or Liability
Effect of Changed Circumstances
Specific Transactions
Presentation and Disclosure
Example of Financial Statement Disclosures
US GAAP Comparison

Chapter 27: Earnings PER Share

Introduction
Scope
Definitions of Terms
Concepts, Rules and Examples
Example of Financial Statement Disclosures
US GAAP Comparison

Chapter 28: Operating Segments

Introduction
Scope
Definitions of Terms
Identification
Concepts and Requirements Under IFRS 8
Disclosure Requirements
Example of Financial Statement Disclosures Under IFRS
US GAAP Comparison

Chapter 29: Related Party Disclosures

Introduction
Definitions of Terms
Identification
Disclosures
Example of Financial Statement Disclosures
US GAAP Comparison

Chapter 30: Accounting and Reporting by Retirement Benefit Plans

Introduction
Definitions of Terms
Scope
Defined Contribution Plans
Defined Benefit Plans
Disclosures
US GAAP Comparison

Chapter 31: Agriculture

Introduction
Scope
Definitions of Terms
Identification
Recognition and Measurement
Presentation and Disclosures
Examples of Financial Statement Disclosures
Other Issues
US GAAP Comparison

Chapter 32: Extractive Industries

Introduction
Definitions of Terms
Exploration and Evaluation of Mineral Resources
Assets Subject to IFRS 6
Example of Financial Statement Disclosures
IFRIC 20 Stripping Cost in the Production Phase of a Surface Mine
Example of Financial Statement Disclosures
Future Developments
US GAAP Comparison

Chapter 33: Accounting for Insurance Contracts

Introduction
Definitions of Terms
Insurance Contracts
Recognition and Measurement Guidance
Disclosure
Future Developments
US GAAP Comparison

Chapter 34: Interim Financial Reporting

Introduction
Scope
Definitions of Terms
Alternative Concepts of Interim Reporting
Objectives of Interim Financial Reporting
Application of Accounting Policies
Presentation
Recognition Issues
US GAAP Comparison

Chapter 35: Hyperinflation

Introduction
Financial Reporting in Hyperinflationary Economies
US GAAP Comparison
Appendix: Monetary vs. Non-Monetary Items

Chapter 36: First-Time Adoption of International Financial Reporting Standards

Introduction
Definitions of Terms
First-Time Adoption Guidance
Optional Exemptions
Presentation and Disclosure

Index

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2018 Interpretation and Application of
IFRS
Standards

Salim Alibhai

Erwin Bakker

T V Balasubramanian

Kunal Bharadva

Asif Chaudhry

Danie Coetsee

Chris Johnstone

Patrick Kuria

Christopher Naidoo

Edward Rands

Darshan Shah

Candice Unsworth

Minette van der Merwe

Santosh Varughese

Paul Yeung

This edition contains interpretations and application of the IFRS Standards, as approved by the International Accounting Standards Board (Board) for issue up to 31 December 2017, that are required to be applied for accounting periods beginning on 1 January 2018.

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ISBN: 978-1-119-46150-0 (pbk)	ISBN: 978-1-119-46152-4 (epdf)
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About the Authors

Salim Alibhai, FCCA, CPA (K), is an audit partner at PKF Kenya and heads the IT assurance including methodology function across the Eastern Africa PKF member firms.

Erwin Bakker, RA, is international audit partner of PKF Wallast in the Netherlands, and acts as audit partner, mainly for international (group) audits. He serves as chairman of the IFRS working group of PKF Wallast and is a member of the Technical Bureau of PKF Wallast in the Netherlands.

T V Balasubramanian, FCA, CFE, CFIP, is a senior partner in PKF Sridhar & Santhanam LLP, Chartered Accountants, India, and previously served as a member of the Auditing and Assurance Standards Board of the ICAI, India. He is a part of the technical team of the firm engaged in transition to Ind AS (the converged IFRS Standards).

Kunal Bharadva, FCCA, CPA (K), ACA, is a senior manager at PKF Kenya and is responsible for technical training across the Eastern Africa PKF member firms.

Asif Chaudhry, FCCA, CPA (K), MBA, is an audit partner at PKF Kenya and heads the technical and quality control functions across the Eastern Africa PKF member firms. He is also a member of the Kenyan Institute's Professional Standards Committee and the PKF International Africa Professional Standards Committee.

Danie Coetsee, CA (SA), is Professor of Accounting at the University of Johannesburg, specializing in financial accounting. He is the chair of the Financial Reporting Technical Committee of the Financial Reporting Standards Council of South Africa.

Chris Johnstone is a member of the ICAEW and also holds ICAEW's Diploma in IFRS. She is the Audit Senior Technical Manager at Johnston Carmichael. She joined Johnston Carmichael in 2014 having previously worked at Baker Tilly and MacIntyre Hudson in London. She is also a member of the Accounting and Auditing Technical Committee of the PKF firms in the United Kingdom and Republic of Ireland.

Patrick Kuria, CPA (K), is an audit partner at PKF Kenya and specializes in the audits of financial services and the not-for-profit sector.

Christopher Naidoo, CA (SA), member of the South African Institute of Chartered Accountants, serves as the international accounting and assurance technical specialist at PKF International Ltd. He also serves on PKF's International Professional Standards Committee (IPSC) and PKF's Assurance Strategy Group (ASG) on accounting and assurance projects.

Edward Rands, FCA, is the Risk and Professional Standards partner at PKF Cooper Parry. He leads the firm's technical team, which is responsible for maintaining and updating accounting knowledge and for dealing with complex problems and queries as they arise. He also chairs the Accounting and Auditing Technical Committee of the PKF firms in the United Kingdom and Republic of Ireland.

Darshan Shah, FCCA, CPA (K), CPA (U), ACA, is an audit partner at PKF Kenya and heads the technical training function across the Eastern Africa PKF member firms.

Candice Unsworth, CA (SA), is a technical manager at PKF International Ltd and serves on PKF's International Professional Standards Committee (IPSC). She qualified at PKF Durban before moving to the technical division of PKF International in 2015.

Minette van der Merwe, CA (SA), is PKF South Africa's IFRS technical expert responsible for the interpretation and application of IFRS within the Southern African region.

Santosh Varughese, CA (Germany), Tax Advisor (Germany), CPA (US), is one of the senior partners at PKF Germany and is based in Frankfurt. He is the head of the IFRS Center of Excellence of PKF in Germany. One of his operative focuses is on audits for large listed companies.

Paul Yeung, CPA, served as the Technical Writer of the Education and Training Department of the Hong Kong Institute of Certified Public Accountants and is a Technical Director of PKF Hong Kong.