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Navigating IFRS , Key Updates and Changes Introduction In today’s fast-paced financial world, staying up to date with the latest International Financial Reporting Standards (IFRS) is critical for CFOs. IFRS 16 Leases: Impact on Balance Sheets IFRS 16 has changed the way leases are recorded on balance sheets.
The extremely high market volatility during the health crisis, one of the economic consequences of COVID, also forced many companies to review their hedging strategy. Many companies hedge on a budgetary basis and qualify hedges of future cash flows by applying the so-called "cash-flow hedge" method under IFRS 9 (ex-IAS 39).
Using the words of IFRS (1.7), ‘ Information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity ’.
5 Other sustainability reporting initiatives in development include those of the International Sustainability Standards Board (ISSB), developed by the International Financial Reporting Standards (IFRS) Foundation. For example, incorporating renewable energy sources can influence an organization’s energy costs, affecting P&L figures.
That said, it does mean that any broad conclusions (about profitability and revenues) that emerge from my data apply to public companies, and it may be dangerous to extrapolate to private businesses, especially in a year like 2020 where private businesses could have been affected more adversely by COVID shutdowns than public companies.
So that you will eventually have the CFO focusing on three reporting areas, the traditional IFRS, then secondly, business efficiencies, and then because of the difficult economic circumstances we are in, the only way that you can still maintain the bottom line is through better efficiencies. The last one is then climate change.
A big part of our work is ensuring compliance with International Financial Reporting Standards (IFRS). You’re involved in high-level decision-making, often working with the CEO on profit and loss management, developing future strategies, and even turning around the company if it’s not performing well.
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