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 […]
Budgeting and Appraisal Techniques [Quiz]
Q1. Choose the best statement regarding non-financial performance indication: a. it is short-sighted to consider that human resources might factor in as an indicator of performance b. absenteeism in the workplace probably indicates the work systems and the environment is stimulating c. being an employer of choice is an excellent example of a non-financial performance […]
What Are Relevant Costs – Meaning and Types
Relevant costs are those costs that will be incurred as a result of a decision and thus should be considered when making that decision. In cost accounting, relevant costs are costs that will contribute to achieving the organisation’s revenue-generating objectives. For an organisation to achieve its profit objectives, the revenues must exceed the relevant costs. […]
Fixed Overhead Variances in Cost Accounting
Fixed overhead variance refers to the difference between the actual fixed production overheads and the absorbed fixed production overheads over a period of time. The variance can either be caused by a difference in the fixed overheads at a given level of activity or because of a difference in the number of units produced (which […]
When changes in accounting policies are permitted?
Though ‘consistency’ is a fundamental accounting assumption, it does not imply that accounting policies adopted once cannot be altered ever in the future. Changes in accounting policies may sometimes be required to maintain the quality and comparability of data. Changes in accounting policies are permitted and justified in the following cases: Notably, accounting policy changes […]