01 Aug 2018 2 min read
The Conceptual Framework for Financial Reporting (2018) defines an asset as “a present economic resource controlled by the entity as a result of past events”, with an economic resource being defined as “a right that has the potential to produce economic benefits”.
Determining whether this definition is met requires a careful analysis of the contractual terms and conditions and economic substance of the arrangements for holding client money to determine whether the client money:
If both conditions apply, the client money should be recognised as an asset of the reporting entity. This determination may involve significant judgement in which case appropriate disclosures should be made in accordance with IAS 1 ‘Presentation of Financial Statements’.
Learn how to determine the transaction price under Step 3 of IFRS 15's five-step revenue recognition model, including key considerations for customer contracts and financial reporting.
Share-based payments have become increasingly popular over the years, with many entities using equity instruments or cash and other assets based on the value of equity instruments as a form of payment to directors, senior management, employees, and other suppliers of goods and services.
Share-based payment transactions with non-employees involve compensating parties other than employees, such as suppliers of goods and services.
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