Optimising Working Capital Levels to Manage an Economic Downturn

Introduction

The COVID-19 pandemic took the world by surprise and resulted in operational and financial disruptions in entities operating across all sectors. Therefore, it is critical for financial controllers, auditors, and financial analysts to understand and assess the impact of this crisis on financial statements. Using the International Accounting Standards (IAS) and the International Financial Reporting Standards (IFRS), our subject matter experts have compiled a list of accounting issues that professionals should refer to when recording accounting transactions and preparing financial statements. By attending this course, you will be able to reduce the risk of misstatement and provide relevant, reliable, and faithfully represented financial information to relevant stakeholders.

Objectives

Upon the successful completion of this program, participants will be able to:

• Identify the qualitative and quantitative disclosures required in financial statements to increase the understandability of balances and transactions
• Recognize important adjustments and allowances required and their effect on financial statements
• Properly account for events and circumstances that are likely to affect balances of assets, liabilities, equity, revenues, and expenses
• List the accounting and financial reporting impact of COVID-19 on the entity’s financial statements and determine the best structure and presentation practices
• Prepare year-end and interim financial statements

Training Methodology

This is an interactive course. There will be open question and answer sessions, regular group exercises and activities, videos, case studies, and presentations on best practices. Participants will have the opportunity to share with the facilitator and other participants on what works well and not so well for them, as well as work on issues from their own organizations. The online course is conducted online using MS-Teams/ClickMeeting.

Who Should Attend?

Professionals in the field of finance and accounting, accountants at all levels seeking to enhance practical finance and accounting knowledge, and certified financial and accounting personnel.

Target Competencies

• Preparing financial statements
• Disclosing financial information
• Applying International Financial Reporting Standards (IFRS)
• Applying professional judgment in financial reporting

Course Outline

Accounting issues: Framework and IAS 1 to IAS 16

• Framework
• Going concern assumption
• IAS 1 Presentation of Financial Statements
• Significant judgments and a key source of estimation
• Breach of loan covenants
• IAS 2 Inventories
• Abnormal waste and production overheads
• Cost versus net realizable value
• IAS 10 Events After the Reporting Period 
• Adjusting events
• Non-adjusting events
• IAS 12 Income Taxes
• Deferred tax assets and liabilities
• Valuation allowance for deferred tax assets
• IAS 16 Property, Plant and Equipment
• Depreciation during the cessation of activity

Accounting issues: IAS 19 to IAS 37

• IAS 19 Employee Benefits
• Liabilities for employee termination
• IAS 20 Government Grants
• Assistance, support, and subsidies received
• IAS 23 Borrowing Costs
• Interest capitalization during periods of suspension
• IAS 28 Investments in Associates and Joint Ventures
• Recognition of losses from interests in associates and joint ventures
• IAS 36 Impairment of Assets
• Cash-generating-units
• Goodwill
• Intangible assets under development
• IAS 37 Provisions, Contingent Liabilities, and Contingent Assets
• Onerous contract provisions
• Provision for restructuring plans
• Contingent assets from insurance reimbursements

Accounting issues: IFRS 2 to IFRS 9

• IFRS 2 Share-based Payment
• Vesting conditions for equity-settled share-based payments
• Fair value of equity instruments for equity-settled share-based payments
• IFRS 7 Financial Instruments: Disclosures
• Liquidity risk disclosures
• Credit risk disclosures
• IFRS 9 Financial Instruments
• Expected credit loss calculations
• Changes in probability of default
• Changes of amount at risk
• Changes in loss given default: collateral value changes
• Hedge accounting: probability of forecasted transactions

Accounting issues: IFRS 13 to IFRS 17

• IFRS 13 Fair Value Measurement
• Reflect market participant views under current market conditions
• IFRS 15 Revenue from Contracts with Customers
• Measurement and recognition of variable consideration
• Probability of customers meeting their obligations
• IFRS 16 Lease
• Modification to timing and amount of lease payments 
• Finance lease treatment
• Operating lease treatment
• IFRS 17 Insurance contracts
• Recognition of insurance obligations