Summary of International Financial Reporting Standards with Professors Audio Explanations

MSc course
International Financial Reporting
Standards
(Code: 6314M0030Y)

2020-2021




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,Inhoud
1. Week 1............................................................................................................................................. 3
1.1. Lecture 1_IFRS_GlaxoSmithKline.pdf ...................................................................................... 3
1.2. Lecture 1_IFRS_Revenue Recognition at Rolls Royce.pdf ....................................................... 8
2. Week 2........................................................................................................................................... 15
2.1. Lecture 2_IFRS_Fixed Assets at Air France KLM.pdf ............................................................. 15
2.2. Lecture 2_IFRS_Leasing at Air France KLM.pdf ..................................................................... 19
3. Week 3........................................................................................................................................... 23
3.1. Lecture 3_IFRS_Hedge Accounting at FIFA.pdf ..................................................................... 23
3.2. Lecture 3_IFRS_Liabilities at Bayer.pdf ................................................................................. 30
4. Week 4........................................................................................................................................... 36
4.1. Lecture 4_IFRS_Group Accounting Moet Hennesy.pdf ......................................................... 36
4.2. Lecture 4_IFRS_Investments at Vivendi.pdf.......................................................................... 43
5. Week 5........................................................................................................................................... 49
5.1. Lecture 5_IFRS_Share Based Compensation at Adyen.pdf ................................................... 49
5.2. Lecture 5_IFRS_Pensions at Shell.pdf ................................................................................... 54
6. Week 6........................................................................................................................................... 60
6.1. Lecture 6_IFRS_Business Combinations at Ahold Delhaize.pdf ............................................ 60
6.2. Lecture 6_IFRS_Goodwill Impairment at Thomas Cook.pdf ................................................. 67




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, 1. Week 1

1.1. Lecture 1_IFRS_GlaxoSmithKline.pdf

Introducing GlaxoSmithKline (GSK)




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,Types of financial statements
- Consolidated financial statements.
o Treating the parent and its subsidiaries as a single economic entity.
- Parent company financial statements.
o Reflects the activities of the parent company and treats the subsidiaries as financial
investments.

Consolidated financial statements for European companies are subject to IFRS. Whereas the parent
company financial statement are free to choose. They usually use their local GAP.

Purpose of financial statements
- Financial statements provide information about an entity’s:
o Assets;
o Liabilities;
o Equity;
▪ Balance sheet.
o Income and expenses, including gains and losses;
▪ Income statement.
o Contributions by and distribution to owners in their capacity as owners;
▪ Statement of changes in shareholder’s equity.
o Cash flows.
▪ Cash flows statement.

Balance sheet
Introducing the balance sheet
- A balance sheet is a snapshot of the status of the financial position of a business entity at a
given point in time.




Defining assets and liabilities
- The balance sheet equation should hold after reporting every economic transactions.




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, Treatment of expenditure in financial reporting. It can end up in:
- Expense → Income statement
- Asset → Balance sheet

Recognition of assets:
- Probable future economic benefits flowing to the entity;
- Its cost or value van be reliably measured.

Accounting for expenditure:
- By plant means building from the ground up
- By R&D, means developing.

Acquisition means buying and those all fall under
Assets.



Defining and classifying assets
- Accounting standards classify assets as non-current versus current;
- Current assets are assets on the balance sheet which can either be converted to cash or used
to pay current liabilities within 12 months (liquid assets).
- Non-current assets are assets of a business intended for continuing use (remaining useful life
> 12 months).

Examples of Currents assets and Non-current assets:




Balance sheet – liabilities and equity
- Equity indicates the amount of financing provided by owners of the business and (retained)
earnings.
- Current Liabilities are the debts a company owes which must be paid within one year.
- Long-term Liabilities include all obligations that are not classified as current liabilities such as
long-term notes payable and bonds payable.




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