Marine PORTAL, Maître de conférences, IAE de Poitiers 2013 - 2014

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LES NORMES IFRS

Approche technique et réflexive

Plan de cours

¨  Une approche réflexive ¤  Introduction + Partie 1+ Partie 3

¨  Une approche technique ¤ Partie 1 + Partie 2

è Applications è Etudes de cas è Exercices

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Le regulatory Framework et le cadre conceptuel   

Introduction 3

Introduction

1.  The IASB & the regulatory process

2.  Convergence and Application

3.  A case study in France

4.  Le cadre conceptuel

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Introduction

¨  IFRSs set out recognition, measurement, presentation and disclosure requirements dealing with transaction and events that are important in general purpose financial statement (Preface to IFRSs, pA16)

¨  IFRSs are designed to apply to the general purpose financial statements and other financial reporting of all profit-oriented entities.

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¨  IFRS 1 First time Adoption of International Financial Reporting Standards

¨  IFRS 2 Share-based Payment

¨  IFRS 3 Business Combinations

¨  IFRS 4 Insurance Contracts

¨  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

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Introduction

¨  The new standards (January 2013)

¤  IFRS 10 Consolidated Financial Statements

¤  IFRS 11Joint Arrangements

¤  IFRS 12 Disclosure of Interests in Other Entities

¤  IFRS 13 Fair Value Measurement (except for UE)

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Introduction

IAS 1  – Presentation of Financial Statements IAS 2  – Inventories IAS 7  – Cash Flow Statements IAS 8  – Accounting Policies, Changes in Accounting Estimates and Errors IAS 10 – Events after the Balance Sheet Date IAS 11 – Construction Contracts IAS 12 – Income Taxes IAS 14 – Segment Reporting IAS 16 – Property, Plant and Equipment IAS 17 – Leases IAS 18 – Revenue IAS 19 – Employee Benefits

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Introduction

IAS 20 – Accounting for Government Grants and Disclosure of Government Assistance IAS 21 – Effects in changes in Foreign Exchange Rates IAS 23 – Borrowing Costs IAS 24 – Related Party Disclosure IAS 26 – Accounting and Reporting by Retirement Benefit Plans IAS 27 – Consolidate and Separate Financial Statements IAS 28 – Investment in Associates IAS 29 – Financial Reporting in hyperinflationery economies IAS 31 – Interests in Joint Ventures IAS 32 – Financial Instruments : Presentation IAS 33 – Earning Per Share

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Introduction

IAS 34 – Interim Financial Reporting IAS 36 – Impairment of Assets IAS 37 – Provisions, Contingent Liabilities and Contingent Assets IAS 38 – Intangible Assets IAS 39 – Financial Instruments: Recognition and Measurements IAS 40 – Investment Property IAS 41 – Agriculture

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Introduction

1. The IASB & the regulatory process (1/8)

¨  From 1973 to 2001 è the IASC

¨  Standards-setting ¤ The IASB (an independant board with private

financing) ¤ The IFRS interpretation committee

¨  The IASB Foundation / IFRS Foundation ¤ The Trustees (22)

¨  IFRS advisory council

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Source : www.ifrs.com

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10 ans avec les IFRS et l’IASB …. 18

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1. The IASB the regulatory process (2/8)

¨  The due process 1.  Setting the agenda 2.  Planning the project 3.  Developing and publishing the discussion paper 4.  Developing and publishing the exposure draft 5.  Developing and publishing the standard 6.  After the standard is issued

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1. The IASB the regulatory process (3/8)

1. SETTING THE AGENDA

¨  The IASB considers: ¤  the relevance to users of the information and the

reliability of information that could be provided ¤ whether existing guidance available ¤  the possibility of increasing convergence ¤  the quality of the standard to be developed ¤  resource constraints.

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1. The IASB the regulatory process (4/8)

2. PLANNING THE PROJECT

¨  When adding an item to its active agenda, the IASB also decides whether to: ¤ conduct the project alone, or ¤  jointly with another standard-setter.

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1. The IASB the regulatory process (5/8)

3. DEVELOPING AND PUBLISHING THE DISCUSSION PAPER

A discussion paper includes:

¤ a comprehensive overview of the issue; ¤ possible approaches in addressing the issue; ¤  the preliminary views of its authors or the IASB; and ¤ an invitation to comment.

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1. The IASB the regulatory process (6/8)

4. DEVELOPING AND PUBLISHING THE EXPOSURE DRAFT

¨  Publication of an exposure draft is a mandatory step in due process.

¨  The development of an exposure draft begins with the IASB considering: ¤  issues on the basis of staff research and recommendations; ¤  comments received on any discussion paper; and ¤  suggestions made by the IFRS Advisory Council, working

groups and accounting standard-setters, and arising from public education sessions.

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1. The IASB the regulatory process (7/8)

5. DEVELOPING AND PUBLISHING THE STANDARD ¨ The development of an IFRS is carried out during IASB meetings, when the IASB considers the comments received on the exposure draft. ¨ After resolving issues arising from the exposure draft, the IASB considers whether it should expose its revised proposals for public comment, for example by publishing a second exposure draft.

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1. The IASB the regulatory process (8/8)

6. AFTER THE STANDARD IS ISSUED ¨  The staff and the IASB members hold regular

meetings with interested parties ¤  to help understand unanticipated issues related to the

practical implementation and potential impact of its proposals.

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2. Convergence & Adoption

¨  Difference between convergence & adoption

¨  IFRS in more than 100 countries ¨  Major exception : United States and Japon ¨  New countries : China and India

¨  In European Union : compulsory adoption since 2005 for consolidated accounts of firms listed on the stock market

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Analysis of the IFRS jurisdictional profiles

1. Commitment to a single set of global accounting standards:

Nearly all of the jurisdictions (121 of the 129) have made a public commitment supporting a single set of high quality global accounting standards. Only Albania, Bermuda, Cayman Islands, Egypt, Macao, Paraguay, Suriname, and Switzerland have not.

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Analysis of the IFRS jurisdictional profiles

2. Commitment to IFRS: The relevant authority in all but 6 of the 129 jurisdictions (Bermuda, Cayman Islands, Egypt, Macao, Suriname, and Switzerland) has made a public commitment to IFRS as the single set of global accounting standards. Even in the absence of a public statement, IFRS are commonly used by listed companies in Bermuda, Cayman Islands, and Switzerland

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Analysis of the IFRS jurisdictional profiles

3. Adoption of IFRS: 105 jurisdictions (81 per cent of the profiles) require IFRS for all or most domestic publicly accountable entities.Some comments on the remaining 24 jurisdictions that have not adopted:

¤  Thirteen jurisdictions permit, rather than require, IFRS: Bermuda, Cayman Islands, Guatemala, Honduras, India, Japan, Madagascar, Nicaragua, Panama, Paraguay, Singapore, Suriname, Switzerland;

¤  Two jurisdictions require IFRS for financial institutions: Uzbekistan, Saudi Arabia;

¤  Two jurisdictions are in process of adopting IFRS in full: Indonesia, Thailand; and

¤  Seven jurisdictions use national or regional standards: Bolivia, China, Egypt, Guinea-Bissau, Macao, Niger, United States.

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2. Convergence & Adoption

¨  Advantages of converting to IFRS : ¤ Same basis for financial statements ¤ One accounting language ¤ A need

¨  Disadvantages of converting to IFRS : ¤ Lost of quality ¤ Outweight the benefits ¤ Cost

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2. Convergence & Adoption

¨  Etude de texte

¤ Convergence approach ¤ Endorsement approach ¤ Condorsement approah

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3. A case study in France

¨  An european regulation (2002)

¨  An european commission dedicated to the IFRS adoption : EFRAG (European Financial Reporting Advisory Groupe) = technical advice

¨  The ARC (an opinion)

¨  Each european country can choose to apply IFRS to firms not listed on stock market

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3. A case study in France

¨  In France : ¤  IFRS for consolidated accounts (for listed or not listed

companies) ¤  IFRS forbidden for individual accounts

¨  Coexistence between : 1.  National standards (4th guideline, PCG) for individual

accounts 2.  National standards (7th guideline, PCG) for

consolidated accounts 3.  IFRS

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4. Le cadre conceptuel

¨  Le cadre définit les concepts qui sont à la base ¤ Des états financiers ¤ De l’objectif des états financiers ¤ Des caractéristiques de l’information ¤ De la définition, comptabilisation et évaluation des éléments

¨  Le cadre ne comporte aucune disposition normative. En conséquence, les dispositions prévues par les normes spécifiques prévalent sur celles du cadre.

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4. Le cadre conceptuel

¨  Le cadre conceptuel de l'IASB n'est pas une norme comptable internationale ; il ne comporte donc pas de disposition normative en matière d'évaluation ou d'information à fournir.

¨  Rien dans ce cadre ne supplante une norme comptable internationale spécifique. Il a éte publié par l'IASC en juillet 1989 et adopté par l'International Accounting Standards Board (IASB) en avril 2001.

¨  Au niveau européen, le cadre conceptuel n'a pas fait l'objet d'une adoption par la Commission européenne (CE) et n'a donc pas éte publié sous la forme d'un règlement (contrairement aux IAS et aux IFRS)

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4. Le cadre conceptuel : OBJECTIFS

¨  Les états financiers sont préparés : ¤  Sur la base de la comptabilite d’engagement (les utilisateurs sont informés

des transactions passées, des obligations à payer, des ressources à recevoir, des mouvements de trésorerie; les transactions sont enregistrées au moment où elles se produisent)

¤  Selon la continuité d’exploitation

¨  Le Cadre définit 4 caractéristiques qualitatives pour que l’information soit utile aux utilisateurs : ¤  L’intelligibilite ¤  La pertinence et l’importance significative

¤  La fiabilité (réalite économique prime sur l’apparence juridique) ¤  La comparabilite (dans le temps et entre les sociétés) : évaluation

cohérente et permanente

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4. Le cadre conceptuel : DEFINITIONS

¨  Un actif : ressources contrôlées dont on attend des avantages économiques futurs

¨  Un passif : obligation actuelle. Sortie d’avantages économiques

¨  Les capitaux propres : intérêt résiduel dans les actifs

¨  Les produits : accroissements d’avantages économiques au cours de l’exercice. Cela inclut : ¤  Les produits des activités ordinaires (ventes, honoraires, intérêts, dividendes,

redevances, loyers, etc.)

¤  Les profits (cession d’actifs)

¤  Les produits latents (augmentation de la juste valeur de certains

¤  actifs)

¨  Les charges : diminutions d’avantages économiques au cours de l’exercice (idem : 3 catégories de charges)

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4. Le cadre conceptuel : COMPTA & EVA

¨  Un élément doit être comptabilisé au bilan et au compte de résultat si : ¤  Il est probable que tout avantage futur qui lui est lié ira à

l’entreprise (actif ou produit) ou en proviendra (passif ou charge);

¤  L’élément a un coût ou une valeur qui peut être évalué de manière fiable

¨  Plusieurs conventions pour l’évaluation des actifs et des passifs : ¤  Convention du coût historique ¤  Convention du coût actuel

¤  Convention de la valeur de réalisation ¤  Convention de la valeur actualisée

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4. Le cadre conceptuel : DISCLOSURE

¨  L’OBJECTIF DE L’INFORMATION FINANCIERE A USAGE GENERAL ¤  L’objectif de l’information financière à usage général est de fournir de

l’information financière sur l’entité comptable qui soit utile aux investisseurs existants et potentiels, aux prêteurs et autres créanciers pour qu’ils prennent des décisions quant à la fourniture de ressources à l’entité.

¤  Ces parties prenantes ne peuvent exiger d’être informées directement par les entités comptables et doivent s’appuyer sur les états financiers à usage général pour obtenir l’essentiel de l’information dont elles ont besoin. C’est pourquoi elles sont les utilisateurs principaux à qui les rapports financiers sont destinés

¤  Les états financiers reposent sur des estimations, des jugements et des modèles plutôt que sur des descriptions exactes. Le Cadre établit les concepts qui les sous-tendent. Il s’agit d’un idéal qui ne peut être atteint pleinement à court terme. Néanmoins, il est nécessaire de se fixer un but vers lequel tendre si on veut être plus utile.

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IFRS CONCEPTUAL FRAMEWORK Presentation

1. Introduction

• A conceptual framework can be defined as

• …. A constitution, a coherent system of interrelated objectives and fundamentals that can lead to consistent standards and that prescribes the nature, functions and limits of financial accounting and financial statements

Standard presentation • The framework deals with :

•  The objective of financial statements

•  The qualitative characteristics that determine the usefulness of information in financial statements

•  The definition, recognition and measurement

•  The concept of capital and capital maintenance

Objective

Qualitative charactéristics

Elements (assets/liabilities and equity)

Measurement + recognition criteria

Presentation and disclosure

Conceptual framework for financial reporting

Introduction •  In october 2004 : agreement to develop a new conceptual

framework

• Project divided into phases •  Phase A = Objectives and qualitative characteristics •  Phase B = Elements •  Phase C = Measurment •  Phase D = Reporting entity •  Phase E = Presentation and disclosure •  Phase F = Purpose and status •  Phase G = Application to not-for-profit entities •  Phase H = Remaining issues

Objective of general purpose financial reporting • Decision usefulness

• Stewardship

• Accruals basis

• For the objectives, 3 underlying asumptions

• Accrual basis

• Going concern

• Stable measuring unit asumption

The qualitative characteristics

•  = attribute that make the information provided in financial statements useful

• Understandability • Relevance • Faithful representation • Comparability • Verifiability • Timeless

Elements of financial statements • Assets

•  A ressource controlled by an entity as a result of past events and from which future economic benefits are expected to flow to the entity

• Liabilities •  A present obligation arising from past events, the settlements of

which is expected to result in an outflow of economic benefits

• Equity (capitaux propres / fonds propres) •  A residual interest in the assets of an entity after deducting all its

liabilities

Elements of financial statements •  Income

•  Increases in ecnomics benefits during an accountign period that result in an increase in equity •  Revenue : ordinary activity •  Gain : for exemple, the profit on disposal of an asset

• Expenses •  Decreases in economic benefits during an accounting period

•  Expenses : ordinary activities •  Losses : for exemple, a disaster

Recognition

• Recognition of financial statements elements

•  Future economic benefit •  With a flow form or to an entity

•  Ressource reliabily measured (with a cost)

Measurement

• Measurement of financial statements elements

•  Historical costs •  Assets recorded at the amount paid at the time they were acquired •  Liabilities recprded at the amount of proceeds received for taking on the

obligation at the amount expected to be paid

•  Current costs •  Assets are carried at the amount that would have to be paid to acquire

an equivalent assets currently •  Liabilities are carried at the unduscounted amount that would be

required to settle the obligation currrently

Measurement

• Measurement of financial statements elements

•  Realisable value •  Assets are carried at the amount that could currently be obtained by

selling them in orderly disposal •  Liabilities are carried at their settlement values

•  Present value •  Assets are carried at the disounted value of the future net cash inflows

they are expected •  Liabilities are carried at the disounted value of the future net cash flows

that are expected

…. • Two ways to consider capital

•  Financial concept of capital = equity or net assets •  Profit is earned only if the financial (or money) amount of the net assets

at the end exceeds the amount at the beginning

•  Physical concept of capital = productive capacity •  Profit is earned only if the physical productive capacity of an entity

exceeds at the end exceeds the physical capacity at the beginning

• è Choice between the two conceptions following the financial statements users •  Financial if maintenance nominal invested capital •  Physical if operating capability

…. •  2 conceptions of profit

•  Maintain financial capital

•  Maintain physical capital

• The main difference is the treatment of changes in prices of assets and liabilities