Need to know — Accounting considerations related to the coronavirus 2019 disease

Published on: 11 Nov, 2020

As the pandemic increases in both magnitude and duration, entities are experiencing conditions often associated with a general economic downturn. This includes, but is not limited to, financial market volatility and erosion, deteriorating credit, liquidity concerns, further increases in government intervention, increasing unemployment, broad declines in consumer discretionary spending, increasing inventory levels, reductions in production because of decreased demand, layoffs and furloughs, and other restructuring activities. The continuation of these circumstances could result in an even broader economic downturn which could have a prolonged negative impact on an entity’s financial results. This Need to know discusses certain key IFRS accounting considerations related to conditions that may result from the COVID‑19 pandemic.

Updated on 8 April 2020. Key changes include the interim reports, clarification that the disclosure of sensitivities of estimates is based on conditions at the reporting date (with separate disclosure if needed about impact of post balance sheet events), clarification on the accounting for penalties on late delivery and additional explanations on how a lessee accounts for a modification , including a reminder about impairment.

Updated on 21 April 2020. Key changes include statement of profit or loss, going concern, impairment of nonfinancial assets, and lease contracts

Updated on 5 May 2020. Key changes include new sections on alternative performance measures, cash and cash equivalents, capitalisation of borrowing costs and exchange rates. A subsection has been added to consolidation, addressing reporting time lags and consistency of accounting policies and the section on lease contracts has been updated to reflect the publication of the exposure draft by the IASB. Changes were also made to the sections on revenue from contracts with customers, government assistance, income tax and interim financial reports. Please refer to Appendix A of the publication for more details on the changes made.#

Updated on 18 June 2020. Key changes include the addition of IOSCO’s expectation in terms of transparency of financial reporting in the introduction and in the alternative performance measures section. The section on lease contracts has been updated and modified to reflect the issuance of the amendment to IFRS 16. Changes were also made to the sections on Impairment – Assets subject to the requirements of IAS 36, Impairment – Valuation of inventories, Government assistance and Interim financial reports. Please refer to Appendix A of the publication for more details on the changes made.

Updated 11 November 2020. Key changes include clarifications on disclosures for ‘Going concern’ and ‘Liquidity risk management’, new subsections on ‘Dividends and capital management’ and ‘Contracts to buy/sell commodities’, added guidance for idle assets in ‘Acquisitions and disposals’, as well as clarifications in ‘Share-based payments’, ‘Government assistance’ and ‘Breach of covenants’.


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