Determining whether an instrument must be classified as equity or a liability has been a contentious issue for many years. There have been various projects on ‘the equity issue’ and the IASB has finally published a much anticipated exposure draft on Financial Instruments with Characteristics of Equity Classification. Does it make it easier to determine what is equity and what is a liability? We’ve...
Ghana has been on the hyperinflation watchlist for a while. Effective 31 December 2023 the International Practices Task Force (IPTF) determined that with a 3-year cumulative inflation of 128% it is now there.
Millionaire’s Club (Pty) Ltd earned loyalty points using its bank card to purchase inventory, electronics and other fixed assets. Can the company recognise the loyalty points on the balance sheet or will it be forced to settle for bragging rights?
Many insurance companies applied the temporary exemption from IFRS 9 Financial Instruments to continue applying IAS 39 Financial Instruments to account for their financial instruments. This was available to entities using IFRS 4 Insurance Contracts until they converted to the new standard IFRS 17 Insurance Contracts. IFRS 17 is effective for years beginning on or after 1 January 2023, the application...
No one enjoys accounting for deferred tax. It can be confusing and, more often than not, a frustrating process. So, when there is an exemption to recognising deferred tax, reporting entities usually jump at the chance. Exemptions can, however, cause their own problems, especially when they are not applied properly.
All JSE-listed entities are required to present this number and its related reconciliation to earnings per IAS 33 Earnings per Share (IAS 33) in their financial reports as the JSE believe there is still a large demand from users in general for a clearly defined reference number which can be used for reporting and comparative purposes.
When assessing whether a contract is a lease one must always consider if the owner of the asset has substitution rights, but what does this mean and how does it play out?
On June 26, 2023, the International Sustainability Standards Board (ISSB) made a significant announcement by issuing its first-ever global sustainability disclosure standards, launching them in South Africa on 29 June 2023. These standards, comprise IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1) and IFRS S2 Climate-related Disclosures (IFRS S2),...
The IASB issued amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures to cater for supplier finance arrangements.
The International Accounting Standards Board (IASB) recently issued amendments to IAS 12 Income Taxes (IAS 12). The Organisation for Economic Co-operation and Development’s (OECD) international tax reform creates accounting implications leading to the recognition deferred tax assets and liabilities. The amendments give companies temporary relief from these accounting implications.
In the 2020 Budget Review the Minister of Finance, Enoch Gondwana, announced a reduction in the corporate tax rate. The reason for the deduction as explained by the Minister of Finance was to improve the country’s competitiveness, reduce the appeal of base erosion and profit shifting, encourage investment and promote economic growth. In this regard, the international trend applied with regards to...
Complex living has become very popular due to the perceived safety and affordability. Complexes range from apartments to estates to retirement villages; we all know someone who is in, was in, or is moving into, one, if not ourselves.
The IASB has issued an exposure draft (‘ED’) with proposed amendments to IFRS 9 Financial Instruments (‘IFRS 9’) and IFRS 7 Financial Instruments: Disclosures (‘IFRS 7’) following feedback received during the Post-implementation Review (‘PIR’) of IFRS 9 Classification and Measurement
20 years of development and the new insurance standard (IFRS 17 Insurance Contracts) is finally here, effective for periods beginning on or after 1 January 2023.
In recent years the IASB amended how the business definition is applied with said amendments becoming effective for business combinations on or after 1 January 2020. The inclusion of a concentration test as a practical expedient assists in simplifying the distinction between a business and an asset acquisition, yet there is often confusion as to what this means practically when accounting for the...
The current/non-current debate continues… but should it?
It is 2023, where are we at when it comes to IBOR reform?
The JSE’s proactive monitoring report from its limited scope thematic review was published in October with going concern, liquidity risk and cash flow statement disclosures being the focus areas. We take a closer look at the main findings identified from the review.
My client did not consider whether there was a significant increase in credit risk as they believe the financial instrument has a low credit risk…. is this correct and what does low credit risk mean in context of IFRS 9 Financial Instruments (‘IFRS 9’)?
Liquidity Risk Maturity Analysis: Lease liabilities back in.
The impact of borrowing costs on the cash flow statement.
IFRS requires what is commonly referred to as a third balance sheet when a preparer reports an error, a change in accounting policy or a reclassification that affects the Statement of Financial Position.
The exposure draft on the IASB’s proposed amendments to SMEs is out! In a nutshell:
Understanding the intricacies between estimates and judgements
The only constant in life is change. Whether you want to not, at some time you need to change, and adapting form the old to the new can be challenging.
The distinction between the role an entity plays as an agent or principal has significant consequences on the recognition and presentation of revenue in the financial statements. Entities often get confused whether to recognise revenue on a gross or net basis. Acting as a principal would require revenue recognition on a gross basis. In other words, the full revenue and the full related expenses would...
While enjoying your December vacation on your lush hotel sheets, have you ever wondered if the sheets were PPE or inventory?
Under International Financial Reporting Standards (“IFRS”) as well as IFRS for small and medium-sized entities (“IFRS for SMEs”), the statement of comprehensive income (“SOCI”), or ‘income statement’ as it is often conversationally referred to, must be presented either “by nature” or “by function”.
I have a JIBAR loan, IBOR reform doesn’t impact me… does it?
Lease contracts typically include various elements other than the leased asset. Common examples include service and maintenance of the asset, recoveries such as water, electricity, sewerage, rates and taxes and insurance (to name a few).
The tax rate reduction was announced for years ending on or after 31 March 2023. How should entities be accounting for the change in corporate tax from 28% to 27% and when?
The Russia/Ukraine conflict, while having devastating effects on people physically and economically, there are accounting impacts that must be considered when preparing financial statements almost anywhere in the world. Click here to read some of the considerations that must be made.
When your company hasn’t received payment for your services for a significant period, should you still be recognising revenue? Read Show me the money! To find out more.
The recent outbreak of the conflict between Russia and Ukraine has caused some uncertainty and possibly panic in the world today, once again. The world economy is taking quite a knock with energy and commodity prices increasing significantly. These significant price increases are diminishing the sprouting post-COVID-19 economic recovery which the world has been awaiting.
The IASB has recently published an exposure draft for proposed amendments to IAS 1 Presentation of Financial Statements (‘IAS 1’) for non-current liabilities with debt covenants. The deadline to submit comments is 21 March 2022.
The JSE has issued their latest proactive monitoring report in November. The date of issuing has been amended from February to November at the request of SAICA, for the benefit of the financial services sector and entities with December to February year-ends. The 2021 report only includes review activities for a 9-month period.
Covid-19 has brought about many changes in the world. One of these is how we use office space.
The JSE has recently published proposed amendments the listings requirements
Among the many recent and upcoming initiatives to enhance audit quality there is one underdog that could really shift the landscape, but will it be soon enough? Could ISQM1 be the secret weapon we do not even realize we have?
There is a great need to change the way we approach the assessment of internal controls, which includes how we consider, find solutions and report on limitations and weaknesses in internal controls. Those charged with governance have a key role to play in influencing this approach to enhance the manner in which management and assurance providers interact by fostering a culture of working more closely...
In May 2020, the IASB issued Covid-19-Related Rent Concessions as an amendment to IFRS 16 Leases, effective for annual reporting periods beginning on or after 1 June 2020 with early adoption permitted (paragraph 46A).
The South African Companies Act allows companies to prepare their financial statements in accordance with one of two frameworks, International Financial Reporting Standards (IFRS), and, if they are not listed, in the process of listing, or a state owned entity, IFRS for Small and Medium-sized Entities (IFRS for SMEs).
The International Accounting Standards Board issued a narrow scope amendment to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2 Making Materiality Judgements to assist preparers in identifying which accounting policies to include in their financial statements by replacing the requirement to disclose all ‘significant’ accounting policies to all ‘material’ policies.
The International Accounting Standards Board has issued an amendment to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors in order to more clearly define an accounting estimate and assist users in distinguishing between a change in accounting policy and a change in accounting estimate.
New Standards and Interpretations not adopted
Good reporting offers a window into the culture of the organisation. Recent years have seen a stronger emphasis placed on reporting quality, with tighter regulation and rising demands from stakeholders. Companies must work harder than ever to tell their story. From fast-growing start-ups to established multinationals, we work with companies to help them communicate clearly and effectively.
Demands for greater financial transparency and proof of organisational sustainability are coming from many sides, including regulators, investors, and other stakeholders. The result: today’s reports are expected to go beyond reporting financials and embrace strategy, quality of governance, remuneration schemes, and even the organisation’s impact on the environment, employees, society and other stakeholders.
This growing list of requirements has already placed a heavy burden on leadership teams and is likely to expand further. At Mazars, we have a strong track record helping our clients to meet – and exceed – the very latest corporate reporting standards.
We bring together a team of professionals combining financial reporting and accounting knowledge with non-financial reporting expertise to deliver a pragmatic business approach.
We regularly support our clients offering them integrated solutions in the following areas:
Financial aspects
Non-financial aspects
Our “Beyond the GAAP” monthly newsletter highlights our approach and our expertise, offering insights into the thinking of national and international accounting standards bodies plus other organisations that can affect corporate reporting such as securities regulators.
We have a continuous innovation process to design and develop bespoke tools and solutions that support our work and help us provide more value and better insights. How we can assist:
Mazars is accredited with JSE Limited to perform IFRS advisory services for listed companies. Mazars has two internal IFRS advisors, Suzanna de Jager and Justine Combrink, who specialise in International Financial Reporting Standards.
We have professionals dedicated to the analysis of emerging accounting and corporate reporting standards, familiar with regulatory requirements in different parts of the world and with extensive experience across different industries.
Members of our team meet regularly with policymakers, participate in industry working groups and collaborate as one global, integrated team to share knowledge and best practice, meaning we are well placed to be proactive in advising our clients on the forthcoming standards and their implications.
Please download latest checklists and documents below:
The JSE requires that CFOs and CEOs of issuers, prepare and present a responsibility statement regarding the effectiveness and adequacy of internal financial controls and the fair presentation of presented financial information. But do you know how to prepare this?
Read moreThe JSE published its latest proactive monitoring report for the year 2020. This report provides an overview of the JSE’s detailed findings from their monitoring activities and summarises the main issues from a reporting perspective that preparers (listed and non-listed) should strongly consider when preparing their respective financial statements.
Read more
IFRS 16 further amendment to COVID-19 related rent concessions
Read moreThe IASB issued a discussion paper in November 2020 on Business combinations under common control
Read more
Mazars latest IFRS Insight addresses the accounting for financial instruments under IFRS. It draws on several relevant IFRS standards to tackle, in one handbook, the entire range of challenges related to financial instruments among which: recognition and derecognition, classification and measurement, impairment for credit risk, derivatives and hedging, and related disclosures. It includes all the new requirements introduced by IFRS 9 and the related amendments to other standards such as IFRS 7.
Read more
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