IFRS 3 – Business Combinations, Scope and Disclosure Requirements
Overview IFRS 3 Business Combinations describes how an acquirer accounts for the purchase of control of a business (e.g. an acquisition or merger). These business combinations are accounted for using the ‘acquisition method,’ which usually requires the purchase of assets and the assumption of liabilities to be valued at their fair values at the acquisition […]
The Sarbanes-Oxley Act of 2002 | Accounting and Ethics
The Sarbanes-Oxley Act of 2002 is a significant legislation aimed at increasing accountability and transparency in U.S. corporations. It was implemented in response to notable accounting scandals that shook the business world, with the intention of preventing similar incidents in the future. The Act also placed corporate governance requirements on public companies, such as Sarbanes-Oxley. […]
Introduction to Operating Costing in Cost Accounting
Operating Costing in Cost Accounting Operating costing provides information about the cost of operating a company’s production facilities. It includes the costs of raw materials, labour, and other expenses incurred in the production process. This information is used to determine the selling price of the company’s products and to assess the profitability of its operations. […]
What are zero coupon bonds and why do people invest in them?
What is a Bond? A bond is an obligation of a government, a company or an individual to pay a sum of money back to you at some time in the future, often with interest. Normally this sum would be repaid in small amounts on a regular basis, for example, a weekly payment. A bond […]
IFRS 2 – Share-Based Payment | Meaning and Scope
IFRS 2 is a standard issued by the International Accounting Standards Board (IASB) that provides guidance on the accounting treatment for share-based payments. Share-based payments are a common form of employee compensation, particularly in high-growth industries such as technology. Share-based payments can take various forms, such as stock options, restricted stock units, or performance shares. […]
IFRS 1 — First-time Adoption of IFRSs
IFRS 1 First time Adoption of International Financial Reporting Standards sets out the processes that a company must take when it adopts IFRSs for the first time as the foundation for compiling its general purpose financial statements. The IFRS offers certain exemptions from the general obligation to comply with each IFRS effective at the conclusion […]
IAS 1 Presentation of Financial Statements
IAS 1 is the foundation of the IAS framework and sets out the overall requirements for the presentation of financial statements. It requires companies to present their financial statements in a way that is clear, concise, relevant, reliable, and comparable. IAS 1 specifies the overall criteria for financial statement presentation, as well as rules for […]
Cost classification according to the accounting treatment
Cost classification in cost accounting is the process of categorizing costs into different groups based on specific characteristics or criteria. It involves classifying costs according to their nature, behaviour, function, or other relevant criteria. The purpose of cost classification is to provide a systematic way to analyze and manage costs within an organization. By classifying […]
What Are 12 Accounting Concepts? – A Summary
Accounting Concepts are the underlying assumptions used to produce a business’s financial statements. The term “concept” refers to an idea or thought. Concepts are the fundamental assumptions and conditions that underpin accounting principles. There are 12 accounting concepts. These are explained below: Money Measurement Concept The money measurement concept (alternatively referred to as monetary measurement) emphasises that […]
What are Treasury Bills? | Duration of Issue
A Treasury bill, also known as a T-bill, is a short-term debt obligation issued by the U.S. Department of the Treasury. T-bills are considered to be one of the safest investments available, as they are backed by the full faith and credit of the U.S. government. T-bills are typically sold in denominations of $1,000 and […]