《F7 财务报告 Financial Reporting （FR）》讲座对应讲义下载 TOPIC_011

doubleround

本帖最后由 doubleround 于 2010-10-7 10:42 编辑


　
I. The accounting problem
　　Before IAS37 provisions were recognized on the basis of prudence, little guidance was given on when a provision should be recognized and how it should be measured. This gave rise to inconsistencies, and also allowed profits to be manipulated.
　　Some problems are noted below:
　　（a） Provisions could be recognized on the basis of management intentions, rather than on any obligation to be entity;
　　（b） Several items could be combined into one large provision. There were known as ‘big bath’ provisions;
　　（c） A provision could be created for one purpose and then used for another;
　　（d） Poor disclosure made it difficult to assess the effect of provisions on reported profits. In particular, provisions could be created when profits were high and released when profits were low in order to smooth profits.
　　（1） Definitions
　　IAS 37 views a provision as a liability.
　　A provision is a liability of uncertainty timing or amount;
　　A liability is an obligation of an enterprise to transfer economic benefits as a result of past transactions or events.
　　昨天 今天 明天

　　
Provision must be based on obligations, not management intentions.
　　（2） Under IAS37, a provision should be recognized:
　　a. When an enterprise has a present obligation;
　　b. It is probable that a transfer of economic benefits will be required to settle it;
　　c. A reliable estimate can be made of its amount; if a reasonable estimate cannot be made, then the nature of the provision and the uncertainties relating to the amount and timing of the cash flows should be disclosed.
　　A provision is made for something which will probably happen. It should be recognized when it is probable that a transfer of economic events will take place and when its amount can be estimated reliably.
　　（3） Contingent liabilities
　　Definition
　　The Standard defines a contingent liability as:
　　（a） A possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the enterprise; or
　　（b） A present obligation that arises from past events but is not recognized because:
　　（i） It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or
　　（ii） The amount of the obligation cannot be measured with sufficient reliability.
　　As a rule of thumb, probable means more than 50% likely. If an obligation is probable, it is not a contingent liability – instead, a provision is needed.
　　Treatment of contingent liabilities
　　Contingent liabilities should not be recognized in financial statements but they should be disclosed. The required disclosures are:
　　（a） A brief description of the nature of the contingent liability;
　　（b） An estimate of its financial effect;
　　（c） An indication of the uncertainties that exist;
　　（d） The possibility of any reimbursement;
　　（4） Contingent assets
　　Definition
　　A possible asset that arises from the past events whose existence will be confirmed by the occurrence of one or more uncertain future events not wholly within the enterprise’s control.
　　A contingent asset must not be recognized. Only when the realization of the related economic benefits is virtually certain should recognition take place. At that point, the asset is no longer a contingent asset.
　　Disclosure: contingent assets
　　Contingent assets must only be disclosed in the notes if they are probable. In that case a brief description of the contingent asset should be provided along with an estimate of its likely financial effect.
　　N.B.
　　对于Provision, Contingent Assets and Liabilities,主要掌握对于在Remote, Possible和Probable情况下的会计处理.
　　Probable （大于50%）, 对于Contingent Liabilities则按Actual Liabilities来处理,进行准备（Make Provision）,对于Contingent Assets则要进行disclosed by note.
　　Possible（小于50%）,对于Contingent Liabilities则要进行disclosed by note,而对Contingent Assets则不予置理.
　　Remote（发生的可能微乎其微）, 对于Contingent Liabilities和Contingent Assets都不予置理
　Degree of probability　Contingent loss　Contingent gain　Virtually certain　Recognized in FS　Recognized in FS　Probable　Recognized in FS　Disclose by note in FS　Possible　Disclose by note in FS　No disclosure　remote　No disclosure　No disclosure
　　
Pay attention to the two different accounting treatments that indicate where there is a conflict between the accrual and the prudence concept, the prudence concept will have the privilege.
　　A flowchart from the IAS37
　　


　　
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5） Measurement
　　
The amount recognized as a
provision
should be the best estimate of the expenditure required to settle the obligation that existed at the balance sheet date. The best estimate should be made on a
prudent basis.

　　
The estimate should take into account:
　　① Risks associated with the cash flows
　　② Expected future events （e.g. new technology or new legislation）
　　③The time value of money, if it has a material effect.
　　
If the time value of money is material then the provision should be discounted. As always, it should be a
pre-tax, risk-specific
discounted factor. The discount factor can be based on:
　　①Current prices using a real discount rate; or
　　②Estimated future prices using a nominal discount rate
　　
The amortization of the discount is a finance cost, and it should be disclosed separately on the face of the income statement.

　　
There are two problems with discounting:
　　（a） Discounting is only required where the effect is material. This is subjective.
　　（b） Risk-specific discount rates are also subjective.
　　Demo:
　　The best of estimate of an obligation is the amount that an entity would rationally pay to settle the obligation at the balance sheet date. One way to calculate the best estimate is by using the statistical method of expected values.
　　For example, if ABC believes that there is a 75% chance that warranties will cost $30000 and a 25% chance that they will cost $60000, then the best estimate of the liability is calculated as:
　　（0.75 X $30000） + （0.25 X 60000） = $37500
　　（6）
Disclosure

　　
The following should be disclosed for each material class of provision:
　　（a） A brief description of the nature of the obligation, including an indication of the timing of payment and details of any significant uncertainties.
　　（b） The carrying amount at the beginning and end of the period.
　　（c） The fact that the amount has been discounted where this is the case.
　　（d） The amount of any anticipated recovery, stating whether or not an asset has been recognized in respect of that anticipated claim.
　　The movements in the year on each material class of recognized provision should be disclosed, showing separately:
　　（a） Additional provisions made in the year and adjustments to existing provisions;
　　（b） Amounts used （i.e. incurred and charged against the provision）
　　（c） Amounts released unused
　　（d） Where the provision is discounted, the amortization of the discount. This will increase the burden of the provision.
　　If this information is commercially sensitive, then only the general nature of the provision need be disclosed, along with the reason for withholding some information. However, the provision itself must still be recognized.
　　（7） Offset

　　
Sometimes an entity may be able to recover the costs required to settle a provision. For example it may have an insurance policy to cover the costs of a law-suit. In general, the liability and the recovery should be treated as a separate liability and a separate asset. This is because the entity remains liable for the full amount, regardless of whether it can recover expenditure from a third party.
　　Amounts should only be offset where the reporting entity no longer has an obligation for that part of the expenditure to be met by the third party.
　　（8） Use of provisions

　　
Provisions should be used only for expenditure that relates to the matter for which the provision was originally recognized.

mikenak

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