9706 · 3.2.1
International Accounting Standards (IAS) flashcards
Revision flashcards for Cambridge 9706 International Accounting Standards (IAS) (syllabus 3.2.1). Flip, recall, then mark a real past-paper question.
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What is the core measurement principle of IAS 2 Inventories?
Inventories must be measured at the lower of cost and net realisable value (NRV).
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What is an 'adjusting event' under IAS 10?
An event after the reporting period that provides evidence of conditions that existed at the end of the reporting period. The financial statements must be adjusted for these events.
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Under IAS 37, when should a provision be recognised?
When there is a present obligation from a past event, an outflow of resources is probable, and the amount can be reliably estimated.
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What is the 'recoverable amount' of an asset according to IAS 36?
The higher of an asset's fair value less costs to sell and its value in use.
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What is the difference in accounting treatment between research and development costs under IAS 38?
Research costs must be expensed as incurred. Development costs may be capitalised as an intangible asset if they meet specific criteria.
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What are the five components of a complete set of financial statements according to IAS 1?
1. Statement of Financial Position, 2. Statement of Profit or Loss and Other Comprehensive Income, 3. Statement of Changes in Equity, 4. Statement of Cash Flows, 5. Notes to the financial statements.
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What are the three main categories of cash flows in a Statement of Cash Flows (IAS 7)?
1. Operating Activities, 2. Investing Activities, 3. Financing Activities.
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Under IAS 16, what are the two measurement models for Property, Plant, and Equipment after initial recognition?
The Cost Model (asset carried at cost less accumulated depreciation and impairment) and the Revaluation Model (asset carried at a revalued amount, being its fair value).