covid-19 – our outlook isn’t what it was…

There’s no shortage of available commentary on going concern implications of covid-19… …whether from preparer or auditor perspectives. In some cases, the pandemic will have exacerbated pre-existing conditions; in others, a previously sound business model and cash flow situation may have been decimated. Poor Cineplex Inc. provides a prime Canadian example of changing fortunes. Its…

Client money – it makes the balance sheet go round!

CPA Canada’s IFRS Discussion Group recently discussed the issue of “client money,” introducing the topic as follows: The term “client money” is used to describe a variety of arrangements in which an entity holds funds on behalf of its clients. Such arrangements may include: a bank may hold money on deposit in a customer’s bank…

Modernizing capital markets, if possible before noon!

Here in Ontario, Canada, we have something new to read, the recently-issued consultation report of the Capital Markets Modernization Taskforce. The taskforce was established in February 2020 to review and make recommendations to modernize Ontario’s capital markets regulation. The report notes that the last such review concluded in 2003, after three years of work, and…

Changes to classification of liabilities – not coming so soon to financial statements near you, part two

The IASB has issued Classification of Liabilities as Current or Non-current—Deferral of Effective Date, amendments to IAS 1 I recapped the underlying subject matter at the time of the exposure draft – basically it relates to classifying a liability as current under IAS 1.69 based on the right at the end of the reporting period…

Reverse factoring; forward movement

The IFRS Interpretations Committee recently considered the issue of reverse factoring arrangements. In such arrangements, a financial institution agrees to pay amounts an entity owes to the entity’s suppliers, and the entity agrees to pay the financial institution at a later date. The request came from Moody’s Investors Service, which reported that while 50% of…

covid-19 – look what it did to our income statement!

We recently looked at the issue of earnings measures adjusted for the impact of covid-19… …which don’t actually appear to be that common at present. As I noted, many regulators and similar bodies preemptively spoke up against the practice, with the UK’s Financial Reporting Council for instance saying: “(Adjusted Performance Measures) which attempt to provide…

Statute-barred liabilities – it’s too late now!

CPA Canada’s IFRS Discussion Group recently discussed a topic that’s quite widely applicable, but doesn’t get mentioned that often… Here’s how the meeting report summarized the background: Entities sometimes incur liabilities that they are unable to pay for a period of time. The unpaid amount may be subject to a statute of limitations that prevents…