Accounting (IFRS/UK GAAP) Flashcards
6 cards from real ACA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Accounting (IFRS/UK GAAP) flashcards as text
Under IAS 37, a provision should be recognised when:
Answer: A present obligation exists, an outflow is probable, and a reliable estimate can be made
IAS 37 requires all three conditions: a present obligation (legal or constructive), a probable outflow of economic benefits, and a reliable estimate of the amount.
Under IAS 18 / IFRS 15, revenue from the sale of goods is recognised when:
Answer: Performance obligations are satisfied
IFRS 15 requires revenue to be recognised when (or as) performance obligations are satisfied, i.e., when control of goods or services transfers to the customer.
Which accounting standard deals with the presentation of financial statements under IFRS?
Answer: IAS 1
IAS 1 sets out the overall requirements for the presentation of financial statements, guidelines for their structure, and minimum requirements for their content.
Under FRS 102, investment property is measured after initial recognition using:
Answer: Either the cost model or the fair value model
FRS 102 allows entities to choose between the cost model and the fair value model for investment property, whereas IAS 40 under IFRS also allows both.
Which of the following is NOT a component of equity under IAS 1?
Answer: Trade payables
Trade payables are a liability, not a component of equity. Equity comprises share capital, share premium, retained earnings, and other reserves such as the revaluation surplus.
Under IAS 10, which event after the reporting period results in adjustment of the financial statements?
Answer: Settlement of a court case confirming a liability that existed at year end
An adjusting event provides evidence of conditions that existed at the reporting date; settlement of a court case confirming a pre-existing liability is a classic adjusting event.