During the recent reporting season, we received a number of common queries from clients – or noted areas where errors were being made.
We’ve grouped these issues into the below four areas, in an effort to help guide you through any challenges you may encounter. We encourage you to ensure that you have relevant accounting policy papers to support your decisions in these areas where necessary.
|- identification of cash generating units
- appropriate support for assumptions, particularly where the risk of impairment is high
|- considerations of reverse acquisitions where the legal acquirer is a shell company
- where special purpose entities (SPE / SPV) have been set up - ensure that the control definition from AASB 10 has been considered
|- identifying performance obligations in contracts
- ensuring that the criteria in AASB 15 paragraph 35 are met where revenue is recognised over time
|- ensuring that the accounting outcome is understood prior to signing the final documents
- generally convertible notes contain a liability component rather than being classified as equity
Disclaimer: This information is general in nature and should not be relied on as advice. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs and seek professional advice before making any decisions based on this information.