Preparing for change

Which of the following amendments will not relate to a set of financial statements ending in 2012?

An amendment to IAS 12, Income taxes

An amendment to IAS 17 Leases

An amendment to IFRS 7, Financial instruments - Disclosures

An amendment to IFRS 1, First time adoption of International Financial Reporting Standards

There is an amendment to IAS 1, Presentation of financial statements, which applies from 1 July 2012. The amendments to IAS 1 retain the one or two statement approach at the option of the entity and revise the way other comprehensive income (OCI) is presented. What is the revision to IAS 1 which affects the way OCI is presented?

OCI should net off those elements which may be recycled and those elements that will not

OCI should aggregate those elements which may be recycled and those elements that will not

OCI should show separate subtotals for those elements which may be recycled and those elements that will not

OCI does not now identify those elements which may be recycled and those elements that will not

The revisions made to IAS 19, Employee benefits, are significant, and will impact most entities. They come into effect from 1 January 2013. The revisions change the recognition and measurement of defined benefit pensions expense and termination benefits and the disclosures required. Which of the following accounting practices has occurred as a result of the revisions to IAS 19?

Actuarial gains and losses using the corridor approach are restricted to 10% of the opening asset or liability position

Actuarial gains and losses are no longer accounted for in OCI

Actuarial gains and losses can now be deferred using the corridor approach

Actuarial gains and losses can no longer be deferred using the corridor approach

New and revised standards on group accounting were published in 2011. For example IFRS 10, Consolidated financial statements replaces IAS 27 Consolidated and Separate Financial Statements and SIC-12 Consolidation - Special Purpose Entities and sets out a single consolidation model that identifies control as the basis for consolidation for all types of entities. Which of the following implementation principles relates to these new standards?

These new standards have to be implemented together and apply from 1 January 2013. (subject to EU endorsement for European entities)

The standards are subject to approval by the FASB before they can be adopted

They can be adopted with immediate effect (subject to EU endorsement for European entities) and can be adopted selectively

EFRAG recommends the mandatory effective date of the Standards to be 1 January 2015

The European Financial Reporting Advisory Group (EFRAG) supports the adoption of the group accounting standards and recommends their endorsement. However, it does not support the mandatory effective date of 1 January 2013. Why does EFRAG not support the mandatory effective date for the new standards?

There is evidence that some financial institutions would need more time to implement IFRS 10, IFRS 11 and IFRS 12

There is evidence that some users do not understand the need for IFRS 10, IFRS 11 and IFRS 12

There is evidence that the petrochemical industries would need more time to implement IFRS 10, IFRS 11 and IFRS 12

There is evidence that some countries would need more time to implement IFRS 10, IFRS 11 and IFRS 12

IFRS 13, Fair value measurement, published in May 2011, deals with fair valuing in entities financial statements. A number of current IFRSs require entities to measure or disclose the fair value of assets, liabilities or equity instruments. Why was there a need for a standard on fair value measurement?

The fair value measurement requirements did not always give a clear measurement or disclosure objective

There was no guidance on fair value through profit or loss

Current reporting standards were being abused

Unrealised profits were being distributed

The comment period for the updated exposure draft, Revenue from contracts with customers, closed recently. Most respondents agreed with many of the proposals but some expressed concerns over the standard. Which of the following were the main concerns for respondents?

Conflict with IAS 11 re long term contract accounting

The lack of disclosures

Lack of clarity on how to identify separate performance obligations

The discounting of future revenue

The FASB and IASB are proposing to fundamentally change the accounting for leases and are attempting to issue a second exposure draft by the end of 2012. The Boards are proposing a right-of-use model for lessees in which all leases are recognised on the statement of financial position at the commencement of the lease. What are the two key factors in initially measuring the right-of-use asset and lease liability for lessees?

The lease term and lease payments

The lease term and lease ownership

The secondary term of the lease and the lease payments

The value of the asset and lease payments

IFRS 9 Financial Instruments is being developed in three phases - classification and measurement, impairment and hedging. The IASB agreed in late 2011 to look at limited modifications to IFRS 9 for classification and measurement. Which of the following was a key amendment to IFRS 9?

IFRS 9 does now require the restatement of comparative period financial statements for the initial application of the classification and measurement requirements

IFRS 9 does not now require the restatement of comparative period financial statements for the initial application of the classification and measurement requirements

The mandatory effective date was changed to 1 January 2016

The mandatory effective date was changed to 1 January 2014

Which of the following is not a current requirement of IFRS 9?

All financial instruments are initially measured at fair value plus or minus, in the case of a financial asset or financial liability not at fair value through profit or loss, transaction costs

IFRS 9 prevents the splitting of embedded derivatives from financial assets

A measurement category other than fair value through profit or loss can be used if the contractual terms of the financial asset result in cash flows that are solely payments of principal and interest on the principal amount outstanding

A three-bucket expected credit loss impairment model

Which of the following amendments will not relate to a set of financial statements ending in 2012?

The comment period for the updated exposure draft, Revenue from contracts with customers, closed recently. Most respondents agreed with many of the proposals but some expressed concerns over the standard. Which of the following were the main concerns for respondents?

IFRS 9 Financial Instruments is being developed in three phases - classification and measurement, impairment and hedging. The IASB agreed in late 2011 to look at limited modifications to IFRS 9 for classification and measurement. Which of the following was a key amendment to IFRS 9?

Which of the following is not a current requirement of IFRS 9?

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