IFRS Accounting Standards & Financial Reporting Concepts Flashcards

Vocabulary flashcards covering key definitions, terms, and measurement criteria across IFRS standards and qualitative financial concepts from the lecture material.

IFRS 1 First-time Adoption of International Financial Reporting Standards

Standard applying to the first set of financial statements that contain an explicit and unreserved statement of compliance with IFRS Accounting Standards, as well as any interim financial statements covered by that period.

Vesting Condition (IFRS 2)

A condition that determines whether the entity receives the services that entitle the counterparty to receive a share-based payment, categorized either as a service condition or a performance condition.

Business Combination (IFRS 3)

A transaction or event in which an acquirer obtains control over a business, such as through the acquisition of shares, acquisition of net assets, legal mergers, or reverse acquisitions.

Control of an Investee (IFRS 10 / IFRS 3)

Control exists when an investor is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.

Cash-generating Unit (CGU)

The smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.

Discontinued Operation (IFRS 5)

A component of an entity that either has been disposed of or is classified as held for sale, representing a separate major line of business or geographical area, part of a single coordinated plan to dispose of such a line/area, or a subsidiary acquired exclusively with a view to resale.

Operating Segment (IFRS 8)

A component of an entity that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the chief operating decision maker (CODM), and for which discrete financial information is available.

Chief Operating Decision Maker (CODM)

The individual or group of individuals responsible for strategic decision making regarding an entity, specifically allocating resources and assessing the performance of operating segments.

Embedded Derivative (IFRS 9)

A component of a hybrid contract that includes a non-derivative host, causing some or all of the contractual cash flows to be modified according to a specified variable (such as an interest rate, commodity price, or foreign exchange rate).

Joint Arrangement (IFRS 11)

An arrangement that binds two or more parties by a contractual agreement and gives them joint control over the arrangement.

Joint Operation (IFRS 11)

A joint arrangement whereby the parties that have joint control of the arrangement have direct rights to the assets, and obligations for the liabilities, relating to the arrangement.

Joint Venture (IFRS 11)

A joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.

Structured Entity (IFRS 12)

An entity that has been designed so that voting or similar rights are not the dominant factor in deciding who controls the entity, such as when voting rights relate to administrative tasks only.

Fair Value (IFRS 13)

The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Highest and Best Use (IFRS 13)

A valuation premise for non-financial assets considering a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant.

Performance Obligation (IFRS 15)

A contractual promise to transfer to a customer either a distinct good/service (or bundle of goods/services) or a series of substantially the same distinct goods/services that have the same pattern of transfer.

Lease (IFRS 16)

A contract, or part of a contract, that conveys the right to use an underlying asset for a period of time in exchange for consideration.

Insurance Contract (IFRS 17)

A contract under which one party (the issuer) accepts significant insurance risk from another party (the policyholder) by agreeing to compensate the policyholder if a specified uncertain future event adversely affects the policyholder.

Net Realisable Value (IAS 2)

The estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs to make the sale.

Key Management Personnel (IAS 24)

Those persons having authority and responsibility for planning, directing, and controlling the activities of the entity, directly or indirectly, including any director of that entity.

Biological Asset (IAS 41)

A living animal or plant managed by an entity for agricultural activity.

Onerous Contract (IAS 37)

A contract in which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it.

Revaluation Criteria for Intangibles (IAS 38 / Source 2)

Under IAS 38, intangible assets (such as AI technology) are not eligible for revaluation unless they belong to an active market; otherwise, they must be measured at cost less accumulated amortisation and impairment losses.

Faithful Representation (Conceptual Framework)

A fundamental qualitative characteristic requiring financial statements to be complete, neutral, and free from error to accurately represent the economic phenomena they purport to show.