Nada Nasri, MBA, CMA®

IFRS/IAS Summary Learn everything you need to know about the global accounting standards: • IFRS Standards IFRS 1 - First-time Adoption of International Financial Reporting Standards IFRS 2 - Share-based Payment IFRS 3 - Business Combinations IFRS 5 - Non-current Assets Held for Sale and Discontinued Operations IFRS 6 - Exploration for and Evaluation of Mineral Resources IFRS 7 - Financial Instruments: Disclosures IFRS 8 - Operating Segments IFRS 9 - Financial Instruments IFRS 10 - Consolidated Financial Statements IFRS 11 - Joint Arrangements IFRS 13 - Fair Value Measurement IFRS 15 - Revenue from Contracts with Customers IFRS 16 - Leases • IAS Standards IAS 1 - Presentation of Financial Statements IAS 2 - Inventories IAS 8 - Accounting Policies, Changes in Accounting Estimates and Errors IAS 10 - Events after the Reporting Period IAS 12 - Income Taxes IAS 16 - Property, Plant and Equipment IAS 19 - Employee Benefits IAS 20 - Accounting for Government Grants & Disclosure of Assistance IAS 21 - The Effects of Changes in Foreign Exchange Rates IAS 23 - Borrowing Costs IAS 24 - Related Party Disclosures IAS 28 - Investments in Associates and Joint Ventures IAS 32 - Financial Instruments: Presentation IAS 33 - Earnings per Share IAS 36 - Impairment of Assets IAS 37 - Provisions Contingent Liabilities and Contingent Assets IAS 38 - Intangible Assets IAS 40 - Investment Property IAS 41 - Agriculture

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Accounting ^^^***** WHAT: Accounting is the procedure of data entry and recording, summarizing, analyzing, and reporting financial data. FIVE BASIC ACCOUNTING PRINCIPLES: 1: Revenue Recognition: → Revenue is recorded at the time of the transaction. 2: Matching Principle: → Assets are recorded at their acquisition cost. 3: Historical Cost: → Fiscal Year Income is compared with Calendar Year Expense. 4: Full Disclosure: → Full disclosure of all relevant info is made available. 5: Objectivity Principle: → Information in books should be true, relevant, & accurate. 5 CATEGORIES OF ACCOUNTING: 1: Assets: → All Tangible & Intangible items owned by the company. 2: Liabilities: → Amounts the company owes to others. 3: Equity: → Net Worth of Entity: Assets - Liabilities 4: Expenses: → Amount paid purchases made in business. 5: Income: → Amount earned by the company from the sale of goods. JOURNAL VS LEDGER: →Journal Entries consist of Debits & Credits, the totals of which should be equal →Journal are then transferred to the appropriate Ledger Accounts FINANCIAL STATEMENTS: 1: Income Statement: → Shows profit or loss during the period. 2: Balance Sheet: → A company's assets, liabilities, and equity at a point in time. 3: Statement of Cash Flow: → Shows the inflow and outflow of cash during the period. DOUBLE ENTRY SYSTEM → Each Accounting Entry will have two sides - Debit and Credit. → The accounts used will be from any of the five categories of accounting. THREE FIELDS OF ACCOUNTING: → Financial Accounting: Preparing the Financial Statements. → Managerial Accounting: Prepare reports for internal use. → Cost Accounting: Measure the performance of resources. TYPES OF ACCOUNTS: → Real: Consists of tangible and intangible assets. → Personal: Accounts for individuals, groups, entities, banks, etc. → Nominal: Accounts related to Gain, Loss, Expense & Income.

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IFRS 2: Share-Based Payment – Unlocking Value for Companies and Employees Understanding IFRS 2: The Impact of Share-Based Payments Share-based payments, such as stock options, are a powerful way for companies to reward employees and align their interests with shareholders. IFRS 2 - Share-Based Payment sets out the accounting principles for these transactions, ensuring transparency and consistency in financial reporting. Key Concepts: Types of Share-Based Payments: Equity-settled: Employees receive company shares or options. Cash-settled: Payments are based on the value of shares but paid in cash. Recognition and Measurement: Share-based payments are measured at fair value on the grant date. Expenses are recognized over the vesting period—the time employees must wait before gaining full rights to the shares. Fair Value Determination: For equity-settled transactions, fair value is typically determined using models like the Black-Scholes Model. Factors considered include share price, exercise price, volatility, and expected life of options. Why IFRS 2 Matters: Accurate accounting for share-based payments ensures companies reflect the real cost of employee compensation, providing a clearer picture of profitability. It also promotes transparency and comparability across companies globally. Challenges in Practice: Valuing share-based payments involves complex assumptions about future market performance and employee behavior. Companies often face difficulties in accurately estimating volatility and forfeiture rates. Over to You: How does your organization handle share-based payments? Share your insights or questions in the comments. Stay tuned for the next post: IFRS 3 - Business Combinations. Let’s continue demystifying IFRS, one standard at a time.

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Conceptual Framework for Financial Reporting Conceptual Framework for Financial Reporting 2018 Conceptual Framework for Financial Reporting 2010 International Accounting Standards AS 1 Presentation of Financial Statements IAS 2 Inventories IAS 7 Statement of Cash Flows IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors IAS 10 Events after the Reporting Period IAS 12 Income Taxes IAS 16 Property, Plant and Equipment IAS 17 Leases (replaced by IFRS 16 from 1 January 2019) IAS 18 Revenue (replaced by IFRS 15 from 1 January 2018) IAS 19 Employee Benefits IAS 20 Accounting for Government Grants and Disclosure of Government Assistance IAS 21 The Effects of Changes in Foreign Exchange Rates IAS 23 Borrowing Costs IAS 24 Related Party Disclosures IAS 26 Accounting and Reporting by Retirement Benefit Plans - coming soon IAS 27 Separate Financial Statements - coming soon IAS 28 Investments in Associates and Joint Ventures IAS 29 Financial Reporting in Hyperinflationary Economies IAS 32 Financial Instruments: Presentation IAS 33 Earnings Per Share IAS 34 Interim Financial Reporting - coming soon IAS 36 Impairment of Assets IAS 37 Provisions, Contingent Liabilities and Contingent Assets IAS 38 Intangible Assets IAS 39 Financial Instruments: Recognition and Measurement (replaced by IFRS 9 from 1 January 2018) IAS 40 Investment Property IAS 41 Agriculture International Financial Reporting Standards IFRS 1 First-time Adoption of International Financial Reporting Standards - coming soon IFRS 2 Share-based Payment IFRS 3 Business Combinations  IFRS 5 Non-current Assets Held for Sale and Discontinued Operations IFRS 6 Exploration for and Evaluation of Mineral Assets - coming soon IFRS 7 Financial Instruments: Disclosures IFRS 8 Operating Segments IFRS 9 Financial Instruments IFRS 10 Consolidated Financial Statements IFRS 11 Joint Arrangements IFRS 12 Disclosure of Interests in Other Entities - coming soon IFRS 13 Fair Value Measurement IFRS 14 Regulatory Deferral Accounts - coming soon IFRS 15 Revenue from Contracts with Customers IFRS 16 Leases IFRS 17 Insurance Contracts IFRS Sustainability Standards Introduction to IFRS Sustainability Reporting IFRS S1 General Requirements: What, How, Where, How Much It Costs IFRS S2 Climate-related Disclosures: What, How, When

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-Financial Reporting For Edita Food Industries From Course Financial Modeling: -The Financial Reporting content is How to Make Analysis on: -COGS Breakdown. -Revenue Breakdown. -Return Side. -Operational Side. -Liquidity Side. -Debt Side. -Altman Z-Score. -Weighted Average Cost of Capital. -DCF. -The Link of Course in the Bio of my Profile. #Finance #FinancialModeling #FinancialAnalysis #FinancialRatio #Breakdown #Wacc #DCF #LoanSchedule #ComparableAnalysis #FinancialReporting #Beta #RegressionAnalysis

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has prepared the financial statements in accordance with International Financial Reporting Standards This standard does not apply to changes in accounting policies in entities that apply International Financial Reporting Standards, as it applies to that International Accounting Standard 8 Accounting Policies, Changes in Accounting Estimates and Errors. Measurement and recognition under IFRS 1 IFRS 1 First Time Application of IFRS An institution or entity must present its opening statement of financial position in accordance with International Financial Reporting Standards on the date of transition to those standards, as that is the starting point for its accounting in accordance with International Financial Reporting Standards. Accounting policies under IFRS 1 IFRS first applied The institution or establishment must use the same accounting policies in the opening statement of financial position prepared in accordance with International Financial Reporting Standards. The institution or establishment should not apply versions of the International Financial Reporting Standards that are no longer in force When preparing its opening statement of financial position in accordance with International Financial Reporting Standards, the institution or establishment must follow the following: 1/ Reconsidering the classification of items of assets and liabilities in accordance with the requirements of International Financial Reporting Standards 2/ Record all assets and liabilities in accordance with International Financial Reporting Standards 3 / Not to prove items as liabilities or assets if the International Financial Reporting Standards do not allow this 4/ Applying international financial reporting standards when measuring and liabilities. Estimates in IFRS 1 IFRS first applied When the facility converts to apply IFRS, it must use the same previous estimates that were prepared in accordance with the national accounting principles, unless it becomes clear that they are not objective or were wrong. If the entity needs to make estimates at the date of its transition to apply international financial reporting standards and it was not previously required during the application of accounting principles, it is made in accordance with international financial reporting standards, it is made according to market prices, interest rates and foreign exchange rates so that they reflect market conditions at the date of transition to standards International Financial Reporting. Presentation and disclosure in IFRS 1 IFRS first applied According to this standard, no exemptions can be granted from the presentation and disclosure requirements included in other international financial reporting standards. The facility must disclose and explain how its transition from national accounting principles to the application of international financial reporting standards has affected its financial performance, financial position and cash flows. An entity that has resumed the

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IFRS 10 Consolidated Financial Statements-Post 3 -Overview of IFRS 10 : What is the objective of IFRS 10? The objective of IFRS 10 Consolidated Financial Statements is to establish principles for the presentation and preparation of consolidated financial statements when an entity controls another entity. More specifically, IFRS 10: Requires an entity (a parent) that controls one or more other entities (subsidiaries) to present consolidated financial statements; Defines the principle of control as the basis for consolidation and sets out how to identify whether the investor controls the investee; Sets out the accounting requirements for the preparation of consolidated financial statements, and Defines an investment entity and sets out an exception to consolidating particular subsidiaries of an investment entity. #IFRS10 #groupconsolidation #cma #cpa #hiring #acca #aca ----------------------------------------------------------- Follow Raajeshwar - Sharing 20+ years of journey. - Helping startups for fund raise

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Accounting Objectives: We are a team and an accounting department in the company really need accounting system elements to practice such below  1) The division of accounting roles according to the required transaction size/scope of businesses  2) All financial and non-financial transaction is of course needs both sufficiency and accuracy of documentation to comply with the law. 3) The implementation of the role and preparation of documents 1 and 2 above must be done correctly, with general rules and consistency until the required update through policies and procedures following the accounting regulation.  4) What accounting system is indispensable are that all the tasks of data entry, data storage, data processing and retrieval of accounting statements need to be run by an accounting technology system and/or ERP System that is appropriate to the business growth direction. In summary, the above is likely a component of Hard Skill per business accounting management system, so in order to ensure more accurate, more specific, the Soft Skill One is needed for all leaders and workers in the business structure, for example for the following elements - Professional ethics and Honesty - Independent work and Teamwork - SMART goal Skills: Bookkeeping and Accounts Closing: - Analyze business transactions occurred - Collect and prepare all required documents  - Book into accounting and management system  - Monitor all account schedule such as cash book, bank statement, inventory lists, account receivable, account payable, fixed assets, prepayment, unearned revenue, accrued expense etc.  - Make adjustment entry account and prepare main financial statement such as Statement of P&L and BS - Align financial reporting following the requirement of management team Teamwork:  - Commitment to work as a team  - Communication to good relationship  - Recognition to team competence  - Provision to both knowledge and experiences working - Evaluation to ending result and resolution

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IFRS 9 - Financial Instrument Key Components of IFRS 9: Classification and Measurement: Financial Assets: Companies must classify their financial assets (like loans, bonds, and receivables) into one of three categories: Amortized Cost: If the asset is held to collect cash flows and those cash flows are solely payments of principal and interest. Fair Value Through Other Comprehensive Income (FVOCI): If the asset is held to collect cash flows and sell financial assets, and cash flows are solely payments of principal and interest. Fair Value Through Profit or Loss (FVTPL): If the asset doesn’t meet the criteria for the other two categories or if it’s designated at fair value through profit or loss. Financial Liabilities: These are usually measured at amortized cost unless they are held for trading or designated at fair value through profit or loss. Impairment: Companies must recognize expected credit losses on their financial assets. This is a forward-looking approach, meaning companies need to estimate losses based on possible future events, not just past events. Three Stages of Impairment: Stage 1: At initial recognition, a 12-month expected credit loss is recognized. Stage 2: If the credit risk increases significantly, a lifetime expected credit loss is recognized. Stage 3: If the asset becomes credit-impaired, a lifetime expected credit loss continues to be recognized, but interest revenue is based on the net carrying amount. Hedge Accounting: This part of IFRS 9 aims to better align hedge accounting with companies' risk management strategies. Types of Hedges: Fair Value Hedges: Protect against changes in the fair value of a recognized asset or liability. Cash Flow Hedges: Protect against variability in cash flows associated with a particular risk. Net Investment Hedges: Used to hedge foreign currency risks on a net investment in a foreign operation. See you on the next one as we explain the concept of the standard in details.

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Principles of IFRS : Here are the top 10 principles of IFRS that are fundamental to financial reporting: Fair Presentation and Compliance with IFRS: Financial statements should present a true and fair view of the financial position, performance, and cash flows of an entity. Compliance with IFRS is presumed to result in financial statements that achieve a fair presentation. Accrual Basis of Accounting: Entities should recognize items as assets, liabilities, equity, income, and expenses when they satisfy the definitions and recognition criteria for those elements in the IFRS framework, rather than based on cash receipts and payments. Going Concern: Financial statements should be prepared on a going concern basis unless management either intends to liquidate the entity or cease trading, or has no realistic alternative but to do so. Materiality and Aggregation: Entities should present separately each material class of similar items and should aggregate immaterial items with amounts of a similar nature or function. Information is material if omitting, misstating, or obscuring it could influence decisions that users make on the basis of financial information about a specific reporting entity. Offsetting: Assets and liabilities, and income and expenses, should not be offset unless required or permitted by an IFRS standard. Frequency of Reporting: IFRS requires an entity to present a complete set of financial statements (including comparative information) at least annually. Comparative Information: Entities should disclose comparative information in respect of the preceding period for all amounts reported in the current period's financial statements. Comparative information should also be included for narrative and descriptive information if it is relevant to understanding the current period's financial statements. Consistency of Presentation: The presentation and classification of items in the financial statements should be retained from one period to the next unless a change is justified by a change in circumstances or a requirement of a new IFRS standard. Substance Over Form: Financial statements should reflect the economic substance of transactions, not merely their legal form. This principle ensures that the financial statements provide a true picture of the entity’s financial position and performance. Fair Value Measurement: Certain assets and liabilities should be measured at fair value, which is 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. This principle is especially relevant in the context of financial instruments and investment properties. #FairPresentation #IFRSCompliance #AccrualAccounting ##RevenueRecognition #GoingConcern #BusinessContinuity #Materiality #FinancialDisclosure #Offsetting #netreporting

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** In Accounting, there are three financial statements; the Balance Sheet, the Income Statement, and the Statement of Cash Flows. In. In the not too distant future, there will be a fourth…** The CFO report. This will be an AI generated all-encompassing review. It will summarize all three statements into an informative and actionable report. It will relate to current market conditions. It will have industry and company specific line of business analysis and recommendations which will be emailed to department heads. It will cover every facet of business fundamentals; challenges, tax, purchasing strategy, ethics… It will be the go-to statement for stakeholders. It will be queriable. It will invite questions and provide answers. It will create questions that stakeholders would not even think to ask… It will render many accounting and finance roles obsolete. Many accounting firms are already shifting to this on some level, they are just withholding the AI process from their clients to maintain their authority and cost justification. It’s just another tool, but at some point, it will become commonplace; Quickbooks, TurboTax, Netsuite, Oracle.. If you are an organization, you want to start prioritizing people who understand leadership, theory, ethics, systems and excellence in order to make this happen. I can help you. Mahalo, 🍹🌴 #cfo #leadership #AI #nonprofit #hospitality #construction

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GAAP vs IFRS 1️⃣ Principles vs. Rules 🎯 IFRS is more principles-based, offering broad guidelines and allowing for interpretation. 🎯 US GAAP, on the other hand, is rules-based, providing detailed instructions and specific requirements. 2️⃣ Revenue Recognition: 🎯 Under IFRS, revenue recognition is guided by the principle of transferring control. 🎯 while US GAAP follows a detailed five-step model to determine when and how much revenue should be recognized. 3️⃣ Inventory Costing: 🎯 US GAAP allows Last In, First Out (LIFO) as a method for inventory costing, which can result in lower taxable income in times of rising prices. 🎯 IFRS prohibits LIFO, requiring companies to use methods like First In, First Out (FIFO) or weighted average cost. 4️⃣ Development Costs: 🎯 IFRS permits the capitalization of development costs when certain criteria are met. 🎯 whereas US GAAP generally requires these costs to be expensed as incurred. 5️⃣ Financial Statement Presentation 🎯 There are differences in the presentation of financial statements, 🎯 such as the classification of certain items and the terminology used. ✨️ For companies operating globally or considering international expansion, understanding these differences is essential for compliance and strategic decision-making. ✨️ Bridging these gaps often involves robust accounting practices and continuous learning. 👉 Are you navigating the complexities of GAAP and IFRS in your role? Share your experiences and insights below! #Accounting #Finance #USGAAP #IFRS #GlobalBusiness #FinancialReporting #GAAP

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Journal Entries Accounting and finance transactions typically require a series of journal entries to record the financial effects of business activities. Below is a list of common journal entries: 1. Sales Transactions Credit Sales: Debit Accounts Receivable Credit Sales Revenue Debit Cost of Goods Sold Credit Inventory Cash Sales: Debit Cash Credit Sales Revenue Debit Cost of Goods Sold Credit Inventory 2. Purchase Transactions Purchase of Inventory on Credit: Debit Inventory Credit Accounts Payable Purchase of Inventory for Cash: Debit Inventory Credit Cash 3. Expense Transactions Payment of Expenses (e.g., Rent, Utilities, Salaries): Debit Expense Account (e.g., Rent Expense, Salaries Expense) Credit Cash or Accounts Payable 4. Accounts Receivable Collections Collection of Receivables: Debit Cash Credit Accounts Receivable 5. Accounts Payable Payments Payment to Suppliers: Debit Accounts Payable Credit Cash 6. Depreciation Expense Recording Depreciation: Debit Depreciation Expense Credit Accumulated Depreciation 7. Accrued Expenses Recording Accrued Expenses (e.g., wages not yet paid): Debit Expense Account (e.g., Wages Expense) Credit Accrued Liabilities or Accounts Payable 8. Unearned Revenue Receiving Advance Payment: Debit Cash Credit Unearned Revenue Recognition of Earned Revenue: Debit Unearned Revenue Credit Revenue 9. Loan Transactions Receiving a Loan: Debit Cash Credit Loan Payable Repayment of Loan Principal: Debit Loan Payable Credit Cash Recording Interest Expense: Debit Interest Expense Credit Cash or Interest Payable 10. Owner’s Equity Transactions Owner’s Investment: Debit Cash (or other assets) Credit Owner’s Equity or Common Stock Owner’s Withdrawal (Drawings): Debit Owner’s Equity or Drawing Account Credit Cash 11. Dividends Declared and Paid Declaration of Dividends: Debit Retained Earnings Credit Dividends Payable Payment of Dividends: Debit Dividends Payable Credit Cash 12. Prepaid Expenses Payment for Prepaid Expense (e.g., insurance): Debit Prepaid Expense Credit Cash Recognition of Expense: Debit Expense Account (e.g., Insurance Expense) Credit Prepaid Expense 13. Bad Debt Expense Recording Bad Debt: Debit Bad Debt Expense Credit Allowance for Doubtful Accounts Write-off of Uncollectible Accounts: Debit Allowance for Doubtful Accounts Credit Accounts Receivable 14. Inventory Adjustments Inventory Shrinkage or Loss: Debit Inventory Loss (or Expense) Credit Inventory 15. Bank Reconciliation Adjustments Bank Fees: Debit Bank Fees Expense Credit Cash Interest Earned: Debit Cash Credit Interest Income

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Advanced Financial Modeler (AFM) Handbook from FMI #Modeling #EXCEL #Budgeting #FinancialModeling #Finance_Accounting_Society_HUB #Finance_Gate #AFM_Course #JohnAbdelsayed #BusinessForecast #FinancialResearch #AFM #FMI #Advanced_Financial_Modeler

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هنكمل مع IAS 1 – Presentation of financial statements - 3 و بيبدا المعيار يكلمنا عن القوائم المالية المستخدمة و بيقولك ان اول قايمة معانا هي قايمة الدخل او الربح او الخسارة Statement of Profit or loss IAS1 allows income and expense items to be presented either: (Statements of financial performance) - in a single statement of profit or loss and other comprehensive income, or - in two statements: a separate statement of profit or loss and a separate statement of other comprehensive income “The principals underpinning the overall presentation of financial statements are set out in IAS 1 – presentation of financial statements. IAS 1 requires that all income and expenses are presented in a statement of profit or loss and other comprehensive income. IAS 1 does not allow entities to choose whether to present income and expense in the P&L section or the OCI section of the statement. IAS 1 states that unless required or permitted by a specific IFRS standard, all items of income and expense recognized in a period shall be included in profit or loss section. The key implication of an item being presented in OCI other than P&L is that the item would not be taken into account when measuring the earnings per share.” “IAS1 states that tax related to OCI is either shown as a separate line in the OCI section of the statement or netted off against each component of other comprehensive income and disclosed in the notes to the financial statements.” Circumstances where items may be excluded from profit or loss for the current year include the correction of errors and the effect of changes in accounting policies (IAS8) *An analysis of expenses must be shown either in the profit or loss section or by note, using a classification based on either the nature of the expenses or their function. This sub classification of expenses indicates a range of components of financial performance, these may differ in terms of stability, potential for gain or loss and predictability

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Sometimes, the default formatting in Excel does not achieve the desired result, so we use custom formatting. Save it! You will use it #excel

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