IFRS Chapter 1 IOSCO- International Organization of Securities Commissions Ensures the global markets can operate in an efficient and

ent and effective basis Members- US SEC, France, Germany, New Zealand Resolved to cooperate to promote high standards of regulation Unite their efforts to establish standards Effective surveillance of international securities transactions Provide mutual assistance to promote the integrity of markets Comprised of IFRS, IAS, and IAI

IASB- International Accounting Standards Board Internationally known In charge of setting standard for international public companies Mission is to develop, in the public interest, a single set of high-quality and understandable IFRS for general purpose financial statements.

SAC- Standards Advisory Council Works with IASB on major policy and technical issues Helps select task force members

International Financial Reporting Standards Has released 9 standard to date Covered subjects such as business combinations and share-based payments

Framework Moving away from the problem by problem approach they issued a document titled Framework for the Preparation and Presentation of Financial Statements Sets forth fundamental objectives and concept the board uses in developing future standards Any new standards must pass through the same due process (discussion paper, public hearing, exposure draft, etc.) Not an IFRS and does not define standards for any particular measurement.

Hierarchy of IFRS 1.) International Financial reporting Standards 2.) International accounting standards 3.) Interpretations originated by the international financial reporting interpretations committee (IFRIC) or the Standing Interpretations Committee (SIC)

Convergence Would benefit both global capital markets and US investors Roadmap has been set to combine them FASB and IASB have set up and extensive work plan to try to complete merge Make their former standards fully compatible as soon as it is practicable Coordinate their future work programs to ensure that once achieved compatibility is maintained.

IFRS Chapter 2 IFRS and GAAP conceptual frameworks are very similar IFRS has more broadly adapted Fair market value GAAP has a concept statement to guide estimation when market related data is unavailable, IFRS is considering to do the same The monetary unit assumption is part of each framework, will vary on the country The economic entity assumption is also part of each framework, however it changes slightly based on the country

IFRS Chapter 3 GAAP and IFRS use the same procedures for debits and credits Transaction analysis is the same for GAAP and IFRS A trial balance in IFRS follows the same format as the textbook Use $ here, currency of the country Internal controls are a system of checks and balances First IFRS statements must be applied retrospectively Also must be transparent, provide a suitable starting point, cost that does not exceed the benifets

IFRS Chapter 4 Differences between GAAP and IFRS Extraordinary items are prohibited in IFRS Multi-step and single step I/S are not mentioned IFRS companies must classify expenses by name or function, GAAP does not, however SEC requires a functional presentation IFRS identifies certain minimum items that should be presented on the income statement, GAAP does not, but SEC rules have more rigorous presentation requirements IFRS does not define key measures like income from operations, GAAP does GAAP does not require companies to indicate the amount of net income attributable to non controlling interest (under net income on I/S) GAAP and IFRS have the same presentation of discontinued operations, but IFRS defines a discontinued operation more narrowly

IFRS revaluation of property plant and equip. is permitted and reported, makes more transactions effecting equity, but not Net income Nature of expense method is simple to apply because allocations of expense to different functions are not necessary, without arbitrary allocations Function-of-expense method of expenses identifies major cost drivers of companies Other comprehensive income can not be displayed within the statement of retained earnings

IFRS Chapter 5 IFRS recommends using Statement of financial position rather than balance sheet IFRS requires a classified statement of financial position except in limited situations GAAP requires specific line items, IFRS is like the book IFRS current assets are listed in reverse order of liquidity..Cash last Non-Current assets may be listed before CA Different terminology Common stock is called Share capital- ordinary Both IFRS and GAAP require disclosures about accounting policies followed, judgments management has made, key assumptions and estimation uncertainty Comparative prior information must be presented annually IFRS allows the term reserve while GAAP it is discourage IFRS likes all categories to be listed under assets and liabilities, no combining The Retained earnings amount may be divided between the unappropriated (the amount usually available) and restricted (bonds or other loans) amounts. Treasury shares are a reduction of equity Share capital- The par or stated value of shares issued Share premium- the excess of amounts paid in over the par or stated value Retained earnings- The corporations undistributed earnings Accumulated other comprehensive income- the aggregate amount of the other comprehensive income items Non controlling interest- a portion of the equity of subsidiaries not owned by the reporting company IFRS allows for revaluation of property plant and equip. on the balance sheet and is shown under its own category.

IFRS Chapter 6 IFRS and GAAP use the same TMV Concept is the same everywhere