IFRS Changes 2024

Navigating the changes
to International Financial
Reporting Standards
A briefing for preparers of IFRS financial statements
2024 Edition
Important Disclaimer:
This document has been developed as an information resource. It is intended as a guide only and the application of its contents to specific situations will depend on the particular
circumstances involved. While every care has been taken in its presentation, personnel who use this document to assist in evaluating compliance with International Financial Reporting
Standards should have sufficient training and experience to do so. No person should act specifically on the basis of the material contained herein without considering and taking professional
advice. Neither Grant Thornton International Ltd, nor any of its personnel nor any of its member firms or their partners or employees, accept any responsibility for any errors it might
contain, whether caused by negligence or otherwise, or any loss, howsoever caused, incurred by any person as a result of utilising or otherwise placing any reliance upon this document.
Navigating the changes to IFRS – 2024 Edition

Contents
SectionPage
Introduction03
Effective dates of new Standards (based on Standards issued at 31 December 2023) 04
Effective from 1 January 2022 05

Narrow Scope Amendments to IFRS Standards 06
IFRS 17 Insurance Contracts 09
Deferred Tax related to Assets and Liabilities arising from a Single Transaction 14
Definition of Accounting Estimates (Amendments to IAS 8) 15
Disclosure of Accounting Policies (Amendments to IAS 1 and Practice Statement 2) 16
International Tax Reform – Pillar Two Model Rules (Amendments to IAS 12) 17
International Tax Reform – Pillar Two Model Rules (Amendments to the IFRS for SMEs) 18
Classification of Liabilities as Current or Non-current (Amendments to IAS 1) 20
Non-current Liabilities with Covenants (Amendments to IAS 1) 21
Lease liability in a Sale and Leaseback (Amendments to IFRS 16) 22
Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7) 23
Lack of exchangeability (Amendments to IAS 21) 25
Grant Thornton’s IFRS publications 26
Navigating the changes to IFRS – 2024 Edition 1

‘The publication now covers
31 March 2023, 30 June
2023, 30 September 2023,
31 December 2023 and
31 March 2024 financial
year ends.’
2 Navigating the changes to IFRS – 2024 Edition

Introduction
This publication is designed to give preparers and reviewers

of IFRS financial statements a high-level awareness of recent
changes to International Financial Reporting Standards. It covers
both new Standards and Interpretations that have been issued
and amendments made to existing ones.
What’s new in the 2024 edition Where a change has been made but an entity is yet to
The 2024 edition of the publication has been updated for apply it, certain disclosures are required to be made under
changes to International Financial Reporting Standards IAS 8 ‘Accounting Policies, Changes in Accounting Estimates
(IFRS) that were published between 1 January 2023 and and Errors’. Disclosures required include the fact that the new
31 December 2023. or amended Standard or Interpretation has been issued but it
has not yet been applied, and known or reasonably estimable
The publication now covers 31 March 2023, 30 June 2023, information relevant to assessing its possible impact on the
30 September 2023, 31 December 2023 and 31 March 2024 financial statements in the period of initial application.
financial year ends.
Identifying the commercial signiﬁcance of the changes in
Contents the publication
The effective dates table on the next page lists all the changes For each change covered in the publication, we have included
covered in the publication and their effective dates. a box on its commercial implications. These sections focus on
two questions:
How to use the publication
Identifying the changes that will affect you • how many entities will be affected?
The effective dates table has been colour coded to help entities • what will be the impact on affected entities?
planning for a specific financial reporting year end, and
A traffic light system indicates our assessment of the answers
identifies:
to these questions.
• changes mandatorily effective for the ﬁrst time
• changes not yet effective Other Grant Thornton International publications
• changes already in effect. Where appropriate, references have been made to other
Grant Thornton International publications that provide more
Where a change is not yet mandatorily effective for a detailed information on the changes discussed in this publication.
particular year end, it may still be possible for an entity to A list of other publications is provided on pages 26 to 29 and
adopt it early (depending on local legislation and the ability should you require further assistance, please get in touch with
to be able to fully comply with all the requirements). the IFRS contact in your local Grant Thornton office.
Grant Thornton International Ltd

January 2024

Effective dates of new
Standards
Based on Standards issued at 31 December 2023

Standard Title of Standard or Interpretation Effective for
Early
Application?
31 Mar 2023
year end
30 Jun 2023
year end
30 Sep 2023
year end
31 Dec 2023
year end
31 Mar 2024
year end
reporting
periods beginning
on or after
References to the Conceptual Framework (Amendments

IFRS 3 1 January 2022 ✓
to IFRS 3)
mandatory effect
mandatory effect
Effective for the
Effective for the
Effective for the

IAS 16 Proceeds before Intended Use (Amendments to IAS 16) 1 January 2022 ✓
Already in
Already in
first time
first time
first time
Onerous Contracts – Cost of Fulfilling a Contract
IAS 37 1January 2022 ✓
(Amendments to IAS 37)
IFRS 1, IFRS 9, Annual Improvements to IFRS Standards 2018-2020 Cycle

1 January 2022 ✓
IFRS 16 and IAS 41 (Amendments to IFRS 1, IFRS 9, IFRS 16, IAS 41)
Insurance Contracts 1 January 2023

IFRS 17 Amendments to IFRS 17 Insurance Contracts 1 January 2023 ✓ 1
Extension of the Temporary Exemption from Applying IFRS 9

(Amendments to IFRS 4)
Effective for the first time
Effective for the first time

Initial Application of IFRS 17 and IFRS 9 – Comparative
Information (Amendment to IFRS 17)
Not yet effective
Not yet effective
Not yet effective

Deferred Tax related to Assets and Liabilities arising from
IAS 12 1 January 2023 ✓
a Single Transaction (Amendments to IAS 12)
IAS 8 Definition of Accounting Estimates (Amendments to IAS 8) 1 January 2023 ✓

Disclosure of Accounting Policies (Amendments to IAS 1
and Practice Statement 2)
International Tax Reform – Pillar Two Model Rules

International Tax Reform – Pillar Two Model Rules

IFRS for SMEs 1 January 2023 ✓
(Amendments to the IFRS for SMEs Standard)
Classification of Liabilities as Current or Non-current

Not yet effective
Not yet effective
Not yet effective
Not yet effective
Not yet effective
IAS 1 Non-current Liabilities with Covenants (Amendments to IAS 1) 1 January 2024 ✓

Lease Liability in a Sale and Leaseback (Amendments to
IFRS 16)
Supplier Finance Arrangements (Amendments to IAS 7

IAS 7 and IFRS 7 1 January 2024 ✓
and IFRS 7)
IAS 21 Lack of Exchangeability (Amendments to IAS 21) 1 January 2025 ✓

The colour coding gives an indication of when the changes covered in the publication become effective in relation to the specific financial reporting year ends set out in the table.
Key: Change already in mandatory effect Change effective for the first time Change not yet effective
Notes
1 Entities that early adopt IFRS 17 must apply IFRS 9 before or on the same date.

Effective from 1 January 2022
The Amendments mentioned on pages 6 to 7 are effective for

reporting periods beginning on or after 1 January 2022.
It may be possible to apply these changes early depending on
local legislation and the requirements of the particular change
in concern. The Amendments are:
• References to the Conceptual Framework
(Amendments to IFRS 3)
• Proceeds before Intended Use (Amendments to IAS 16)
• Onerous Contracts – Cost of Fulfilling a Contract
• Annual Improvements to IFRS Standards 2018-2020 Cycle
(Amendments to IFRS 1, IFRS 9, IFRS 16, IAS 41)
As the above represent relatively minor amendments that
were all issued at the same time, they have been combined
in this publication.

Narrow Scope Amendments
to IFRS Standards
In May 2020 the International Accounting Standards Board The amendments
(IASB) issued a collection of narrow scope amendments to The amendments issued are as follows:
IFRS Standards. The collection includes amendments to • References to the Conceptual Framework (Amendments
three Standards as well as Annual Improvements to IFRS to IFRS 3)
Standards, which addresses non-urgent (but necessary) • Property, Plant and Equipment: Proceeds before Intended
minor amendments to four standards. Use (Amendments to IAS 16)
• Onerous Contracts – Cost of Fulfilling a Contract
• Annual Improvements to IFRS Standards 2018-2020 cycle
Publications issued
Standard affected Subject IASB’s summary of amendment
IFRS 3 ‘Business References to the Conceptual Adds a new exception to the recognition principle in order to make sure that the
Combinations’ Framework accounting remains unchanged.
Prohibits an entity from deducting from the cost of property, plant and
IAS 16 ‘Property, Plant equipment amounts received from selling items produced while the entity is
Proceeds before Intended Use
and Equipment’ preparing the asset for its intended use. Instead, an entity will recognise such
sales proceeds and related cost in profit or loss.
IAS 37 ‘Provisions,
Onerous Contracts – Cost of pecifies which costs an entity includes when assessing whether a contract
S
Contingent Liabilities
Fulfilling a Contract will be loss-making.
and Contingent Assets’
‘The collection includes amendments to three Standards as well

as Annual Improvements to IFRS Standards, which addresses
non-urgent (but necessary) minor amendments to four standards.’

Annual Improvements to IFRS Standards 2018-2020 Cycle
Standard affected Subject IASB’s summary of amendment
IFRS 1 ‘First time Adoption Simplifies the application of IFRS 1 by a subsidiary that becomes a first-
Subsidiary as a First-time
of International Financial time adopter after its parent in relation to the measurement of cumulative
Adopter
Reporting Standards’ translation differences.
Fees in the ‘10 per cent’ Test Clarifies the fees an entity should include when assessing whether the terms of
IFRS 9 ‘Financial
for Derecognition of Financial a new or modified financial liability are substantially different from the terms
Instruments’
Liabilities of the original financial liability.
Illustrative Examples
Accompanying IFRS 16 Lease Incentives Removes potential for confusion regarding lease incentives.
‘Leases’
emoves a requirement to exclude cash flows from taxation when measuring

R
Taxation in Fair Value
IAS 41 ‘Agriculture’ fair value thereby aligning the fair value measurement requirements in IAS 41
Measurements
with those in other IFRS Standards.
Commercial significance
Few
Number of
entities affected
The amendments make changes to relatively narrow areas

within IFRS.
Low
Impact on
affected entities
The amendments and the IASB’s Annual Improvements process

addresses non-urgent, but necessary minor amendments to
IFRS. By their nature then, their commercial significance can be
expected to be low. Overall the changes are uncontroversial.

The Standards discussed on pages 9 to 18 are effective for

local legislation and the requirements of the particular change
in concern. The Standard and Amendments are:
• Insurance Contracts, including:
– Amendments to IFRS 17
– Extension of the Temporary Exemption from Applying
IFRS 9 (Amendments to IFRS 4)
– Initial Application of IFRS 17 and IFRS 9 – Comparative
Information (Amendment to IFRS 17)
• Deferred Tax Relating to Assets and Liabilities arising from
a Single Transaction (Amendments to IAS 12)
• Definition of Accounting Estimates (Amendments to IAS 8)
• Disclosure of Accounting Policies (Amendments to IAS 1
• International Tax Reform – Pillar Two Model Rules
• International Tax Reform – Pillar Two Model Rules
(Amendments to the IFRS for SMEs Standard)

IFRS 17 Insurance Contracts
In May 2017, after more than 20 years in development, the This definition is similar to that in IFRS 4. In addition, IFRS 17
IASB published IFRS 17 ‘Insurance Contracts’. This lengthy provides guidance on how to assess the significance of
completion period reflects a number of factors including: insurance risk based on the possibility of a loss on a present
• very diverse local practices for insurance accounting value basis (rather than nominal), and how to evaluate
• a huge range of jurisdiction-specific products, tax changes in the level of insurance risk.
implications and regulations that had to be captured by
Measurement
a uniform measurement model
IFRS 17 requires an entity that issues insurance contracts
• the need for alignment with other Standards that have been
to report them on the statement of financial position as the
recently published by the IASB, such as IFRS 9 and IFRS 15
total of:
‘Revenue from Contracts with Customers’, and to some
degree the work of other standard setters. • the fulfilment cash flows – the current estimates of amounts
that the insurer expects to collect from premiums and
The new Standard replaces IFRS 4 ‘Insurance Contracts’ which pay out for claims, benefits and expenses, including an
was published in 2004. IFRS 4 was designed to be an interim adjustment for the timing and risk of those cash flows, and
Standard and therefore allowed entities issuing insurance • the contractual service margin – the expected profit for
contracts to carry on accounting for them using policies that providing future insurance coverage (ie unearned profit).
had been developed under their previous local accounting
standards. This meant that entities continued to use a multitude The measurement of the fulfilment cash flows reflects the
of different approaches for accounting for insurance contracts, current value of any interest rate guarantees and financial
making it difficult to compare and contrast the financial options included in the insurance contracts.
performance of otherwise similar entities.
To better reflect changes in insurance obligations and risks,
IFRS 17 solves the comparison problems created by IFRS 4 IFRS 17 requires an entity to update the fulfilment cash flows at
by requiring all insurance contracts to be accounted for in a each reporting date, using current estimates that are consistent
consistent manner, benefiting both investors and insurance with relevant market information. This means that insurance
companies. We briefly discuss some of the areas covered by obligations will be accounted for using current values instead
the new Standard below: of historical cost, ending the practice of using data from when
a policy was taken out.
Scope
IFRS 17 applies to all insurance contracts that an entity Current discount rates are also required to be used. These
issues (including those for reinsurance); reinsurance contracts will reflect the characteristics of the cash flows arising from
it holds; and investment contracts with a discretionary the insurance contract liabilities, a change from the previous
participation feature, provided the entity also issues insurance situation where many entities used discount rates based on
contracts. It is not an industry specific standard. It applies to the expected return on assets backing the insurance contract
any reporting entity that issues insurance contracts, so great liabilities.
care is needed to ensure the requirements set out in IFRS 17
Revenue is no longer equal to written premiums but to the
are not overlooked.
change in any contract liability covered by consideration
IFRS 17 defines an insurance contract as one under which during the reporting period.
one party (the issuer) accepts significant insurance risk from
another party (the policyholder) by agreeing to compensate
the policyholder if a specified uncertain future event (the
insured event) adversely affects the policyholder.

Insurance performance Reinsurance contracts
IFRS 17 requires an entity to provide information that A separate measurement model applies to reinsurance
distinguishes two ways insurers earn profits from insurance contracts held. Modifications are allowed for qualifying
contracts: short-term contracts and participating reinsurance contracts.
• the insurance service result, which depicts the profit or loss
Presentation
earned from providing insurance coverage
Statement of financial position
• the financial result, which captures:
The statement of financial position should present in separate
– investment income from managing financial assets
captions the assets and liabilities arising under insurance
– insurance finance expenses arising from insurance
contracts issued and reinsurance contracts held.
obligations – this includes the effects of discount rates
and other financial variables on the value of insurance In contrast to practices existing under various local GAAPs,
obligations. entities should adopt a grossed-up presentation where
contracts, which are assets, are not netted off against
When applying IFRS 17, changes in the estimates of the
contracts, which are liabilities and vice versa. IFRS 17 does not
expected premiums and payments that relate to future
mandate a layout for the statement of financial position. The
insurance coverage will adjust the expected profit – ie the
reporting entities should follow the general requirements of
contractual service margin for a group of insurance contracts
IAS 1 ‘Presentation of Financial Statements’ but need to ensure
will be increased or decreased by the effect of those changes.
that certain captions are presented as a minimum on the face
The effect of such changes in estimates will then be recognised of the statement.
in profit or loss over the remaining coverage period as the
Statement of financial performance – measurement of revenue
contractual service margin is earned by providing insurance
and expenses
coverage.
IFRS 17 does not mandate a layout for the statement of
Onerous contracts financial performance. Reporting entities should follow the
To make differences in profitability among insurance contracts principles and requirements of IAS 1 and the measurement
visible, IFRS 17 requires an entity to distinguish groups of rules of IFRS 17, which require that revenue and incurred
contracts expected to be loss-making from other contracts. expenses presented in profit or loss exclude any investment
components.
Companies should first identify portfolios of insurance
contracts that are subject to similar risks and managed Measurement of insurance contract revenue
together. Once an entity has identified portfolios of contracts, Revenue recognition is an area where IFRS 17 principles
it divides each portfolio into groups considering differences in represent a significant change from practices previously
the expected profitability of the contracts. followed in various local GAAPs. Previously revenue was often
reported by reference to premium cash received or receivable.
If the amounts that the insurer expects to pay out on a
contract in the form of claims, benefits and expenses exceed Under IFRS 17, revenue represents the total change in the
the amounts that the insurer expects to collect from premiums, liability for remaining coverage that relates to coverage and
either at the inception of the contracts or subsequently, the services during the period for which the entity expects to
contracts are loss making and the difference will be recognised receive consideration.
immediately in profit or loss.

Supporting materials issued by the IASB Impact of IFRS 17 on non-insurance entities
Following publication of IFRS 17, the IASB has announced IFRS 17 does not constitute industry specific guidance. Instead,
various initiatives to support entities with the adoption of the it specifies principles which should be applied to contracts
Standard, including a dedicated implementation support page that meet the definition of an insurance contract in IFRS 17
for IFRS 17. irrespective of the legal and regulatory status of their issuer.
The IASB also established a Transition Resource Group which Non-insurers therefore need to be alert to the possibility that
considered questions from stakeholders about the new contracts they have issued (or may issue in the future) might
accounting requirements. Further details about what that now fall within the scope of the new Standard. This may result
group considered can be found on the IASB website. in significant changes to the accounting.
Disclosure Effective date and transition

The objective of the disclosure requirements of IFRS 17 is IFRS 17 has a revised effective date of 1 January 2023 but
to disclose information which allows the users of financial may be applied earlier provided the entity applies IFRS 9
statements to assess the effect that contracts within the and IFRS 15 at or before the date of initial application of the
scope of the Standard have on the entity’s financial position, Standard (and subject to any considerations imposed by local
financial performance and cash flows. Entities should provide legislation). The effective date was revised in June 2020 as
quantitative and qualitative information about amounts part of a series of amendments to IFRS 17 – see below for more
recognised in the financial statements, significant judgements details.
(and changes thereof), and the nature and extent of risks
arising from contracts within the scope of the Standard. Amendments to IFRS 17
After concerns raised by stakeholders, in June 2020 the IASB
Reporting entities are required to follow IAS 1’s requirements on issued ‘Amendments to IFRS 17’ (the Amendments). The aim
materiality and aggregation when deciding what aggregation of the amendments was to address these concerns and help
bases are appropriate for disclosure. The type of contract, entities to more easily transition and implement the Standard.
geographical area or reportable segment as defined in
IFRS 8 ‘Operating Segments’ are all examples suggested
but not mandated by the Standard.
‘IFRS 17 solves the comparison problems created by IFRS 4

by requiring all insurance contracts to be accounted for in a
consistent manner, benefiting both investors and insurance
companies.’

Area of change Description
T he amendments defer the effective date of IFRS 17 by two years from annual
reporting periods beginning on or after 1 January 2021 to annual reporting
periods beginning on or after 1 January 2023. The amendments also extend
Effective date of IFRS 17 and the IFRS 9 temporary exemption
the temporary exemption (included in IFRS 4) from IFRS 9 by two years so that
an entity applying the exemption would be required to apply IFRS 9 for annual
The amendments add additional scope exclusions for credit card contracts
Scope exclusions that provide insurance coverage, and also an optional scope exclusion for loan
contracts that transfer high insurance risk.
The amendments include guidance on the recognition of insurance acquisition

cash flows relating to expected contract renewals, including transition
Expected recovery of insurance acquisition cash flows
provisions and guidance for insurance acquisition cash flows recognised in a
business acquired in a business combination.
The amendments clarify the application of contractual service margin (CSM)

Contractual service margin attributable to investment-return
attributable to investment-return service and investment-related service and
service and investment-related service
changes to the corresponding disclosure requirements.
The amendments extend the risk mitigation option to include reinsurance

Applicability of the risk mitigation option
contracts held and non-financial derivatives.
The amendments clarify the application of IFRS 17 in interim financial

Interim financial statements
statements allowing an accounting policy choice at a reporting entity level.
The amendments require an entity that at initial recognition recognises losses

Reinsurance contracts held — recovery of losses on
on onerous insurance contracts issued to also recognise a gain on reinsurance
underlying insurance contracts
contracts held.
The amendments require an entity to present separately in the statement of

financial position the carrying amount of portfolios of insurance contracts
Presentation in the statement of financial position
issued that are assets and those that are liabilities rather than groups of
insurance.
The amendments add extra transitional reliefs for business combinations, the
Transitional modifications and reliefs date of application of the risk mitigation option and the use of the fair value
transition approach.
The amendments add minor changes where the drafting of the Standard did
Minor amendments
not achieve the IASB’s intended outcome.
Extension of the temporary exemption from applying IFRS 17 and IFRS 9 ‘Financial Instruments’ have different
IFRS 9 to IFRS 4 transition requirements. For some insurers, these differences
In 2020, the IASB also issued further amendments to the can cause temporary accounting mismatches between
existing insurance Standard IFRS 4, ‘Extension of the Temporary financial assets and insurance contract liabilities in the
Exemption from Applying IFRS 9 (Amendments to IFRS 4)’ comparative information they present in their financial
so that entities can still apply IFRS 9 alongside IFRS 17 until statements when applying IFRS 17 and IFRS 9 for the first time.
1 January 2023.
The amendment will help insurers to avoid these temporary
Initial Application of IFRS 17 and IFRS 9 – Comparative accounting mismatches and, therefore, will improve the
Information (Amendment to IFRS 17) usefulness of comparative information for investors. It will do
During 2021, the IASB then issued another narrow-scope this by providing insurers with an option for the presentation
amendment to IFRS 17 which is applicable on transition to of comparative information about financial assets.
the new Standard. However, it does not impact any other
requirements of IFRS 17.

Commercial significance
For more information on the Standard,
specifically as it relates to non-insurance
Insights into
IFRS 17
entities, please refer to our detailed
Impact on non-insurance entities
publication entitled ‘Insights into IFRS

The IASB issued IFRS 17 ‘Insurance Contracts’ to replace the identically titled IFRS 4.
It is a Standard that came into effect for reporting periods beginning on or after
1 January 2023. As its title suggests, IFRS 17 addresses the accounting for insurance
contracts rather than being explicitly aimed at insurance entities. As a result, it applies
Some
Number of
17 – Impact on non-insurance entities’.
entities affected
equally to insurance contracts issued by insurance and non-insurance entities.
This publication examines the scope of the Standard Introduction

and considers situations where a contract issued by a
non-insurance entity may fall within that scope. For the IFRS 17 does not constitute industry specific guidance. Instead
purposes of this publication, a non-insurance entity should be it specifies principles which should be applied to contracts
considered as any entity whose primary source of business is that meet the definition of an insurance contract on IFRS 17
not the issuance of insurance contracts as defined in IFRS 17, irrespective of the legal and regulatory status of their issuer.
This publication sets out the key factors

and whose contractual activities are not actively monitored
by an insurance regulator. In many jurisdictions there are laws Therefore, entities issuing extended warranties, credit related
and regulations that define whether or not the activities of a guarantees, guarantees of pension obligations of Group
reporting entity result in it being classified as an insurer or not. entities, bonds related to participation in tenders or for
contract execution, weather derivatives, etc. should carefully
analyse the terms of such arrangements even when they
might not have the legal form of an insurance contract.
that non-insurance entities will need to “The articles in our ‘Insights

into IFRS 17’ series explain the
consider when applying IFRS 17 for the

key features of the Standard
and provides insights into their
application and impact. This
article explains the objective
and scope of IFRS 17.”
first time. To obtain your copy, please get IFRS 17 is a Standard about insurance contracts, not
in touch with the IFRS contact in your local Grant Thornton a Standard for the insurance industry. While insurance
office or go to https://www.grantthornton.global/en/ companies will be most affected, its effect will also be felt
insights/articles/ifrs-17-insights/insights-into-ifrs-17/ beyond the entities authorised to carry out regulated
insurance activities in a jurisdiction.
High
Impact on
affected entities
IFRS 17 fundamentally changes the accounting for insurance

contracts. It has a substantial impact on the financial
statements of those with insurance contracts. Presently there is
a huge diversity in the way insurance contracts are accounted
for, IFRS 17 is set to harmonise these accounting practices and
will transform data, people, technology solutions and investor
relations. Implementation costs are likely to be high as entities
apply the new Standard.
‘To better reflect changes in insurance obligations and risks,

IFRS 17 requires an entity to update the fulfilment cash flows at
each reporting date, using current estimates that are consistent
with relevant market information.’

Deferred Tax related to
Assets and Liabilities arising
from a Single Transaction
In May 2021 the IASB issued ‘Deferred Tax related to Assets Commercial significance
and Liabilities arising from a Single Transaction’ (Amendments
to IAS 12).
The amendments
Many
Number of
In specific circumstances, entities are exempt from recognising
deferred tax when they recognise assets or liabilities for the first
entities affected
time. There had been some diversity in practice as to whether
the exemption applied to transactions such as leases and
decommissioning obligations. These are transactions where The amendments affect all entities with leases accounted for
entities recognise both an asset and a liability. under IFRS 16.
The amendments require an entity to recognise deferred tax on

certain transactions (eg leases and decommissioning liabilities)
that give rise to equal amounts of taxable and deductible
Low
Impact on
temporary differences on initial recognition.
affected entities
The amendments clarify that the initial recognition exemption
set out in IAS 12 ‘Income Taxes’ does not apply and entities are
required to recognise deferred tax on these transactions. The The impact is on initial recognition of these transactions with
aim of the amendments is to reduce diversity in the reporting the aim to reduce diversity in practice. In many instances it will
of deferred tax on leases and decommissioning obligations. not have a major impact.
The amendments are effective for annual reporting periods
beginning on or after 1 January 2023, with early application
permitted.

Definition of Accounting
Estimates (Amendments to
IAS 8)
In February 2021 the IASB issued amendments to IAS 8 to Commercial significance
clarify how reporting entities should distinguish changes in
accounting policies from changes in accounting estimates.
The amendments
Many
Number of
The amendments include a definition of ‘accounting estimates’
as well as other amendments to IAS 8 that will help entities
entities affected
distinguish changes in accounting policies from changes in
accounting estimates.
The amendments affect all entities that could potentially
This distinction between these two types of changes is have a change in accounting estimate or change in
important as changes in accounting policies are normally accounting policy.
applied retrospectively to past transactions and events,
whereas changes in accounting estimates are applied
prospectively to future transactions and events.
The amendments are effective for annual reporting periods Medium

Impact on
beginning on or after 1 January 2023. Earlier application is affected entities
permitted.
These amendments could have the potential to have a

significant impact if an entity has incorrectly concluded a
transaction is a change in accounting estimate rather than
a change in accounting policy or vice versa.
‘In February 2021 the IASB issued amendments to IAS 8 to clarify

how reporting entities should distinguish changes in accounting
policies from changes in accounting estimates.’

Disclosure of Accounting
Policies (Amendments to IAS 1
In February 2021, the IASB issued amendments to IAS 1 and Commercial significance
IFRS Practice Statement 2 ‘Making Materiality Judgements’
aiming to improve accounting policy disclosures.
The amendments
Many
Number of
The amendments to IAS 1 require reporting entities to disclose
their material accounting policy information rather than their
entities affected
significant accounting policies. The amendments to IFRS
Practice Statement 2 provide guidance on how to apply the
concept of materiality to accounting policy disclosures. The amendments affect all reporting entities when disclosing
their accounting policies.
These amendments were issued as a result of feedback
received indicating that reporting entities needed more
guidance when determining what accounting policy
information should be disclosed.
Medium
Impact on
The amendments are effective for annual reporting periods affected entities
beginning on or after 1 January 2023. Earlier application
is permitted.
These amendments impact what accounting policies are
disclosed which could affect investors’ decisions.
‘In February 2021, the IASB issued amendments to IAS 1 and

IFRS Practice Statement 2 ‘Making Materiality Judgements’
aiming to improve accounting policy disclosures.’

International Tax Reform
– Pillar Two Model Rules
In May 2023, the IASB issued amendments to IAS 12 to give Effective date and transition
entities temporary relief from accounting for deferred taxes Entities are able to benefit from the temporary exception
arising from the Organisation for Economic Co-operation immediately as soon as the amendments are published but
and Development’s (OECD) international tax reform. The in providing this exemption they are required to provide the
amendments introduce both a temporary exception and disclosures to investors for annual reporting periods beginning
some targeted disclosure requirements. on or after 1 January 2023.
The OECD published its Pillar Two Model Rules in December Commercial significance
2021 to ensure that large multinational companies (ie groups
with revenue of EUR750 million or more in two of the last four
years) would be subject to a minimum 15% tax rate. The
reform is expected to apply in most jurisdictions for accounting Some
Number of
periods starting on or after 1 January 2024. entities affected
However, while the reaction from jurisdictions around the world
to implement the changes has been positive, there have been
major stakeholder concerns about the uncertainty over the The Pillar Two Rules only apply to large multinational
accounting for deferred taxes arising from the implementation companies which operate in low-tax jurisdictions.
of these rules. Therefore, the IASB has acted quickly to address
these concerns and provide direction on what they expect
entities to disclose.
Medium
Impact on
The amendments
The amendments: affected entities
• provide a temporary recognition exception to accounting
for deferred taxes arising from the implementation of the
international tax reform (Pillar Two Model Rules). The aim of The amendments will provide a significant saving to reporting
this exception is to provide some consistency in applying entities in terms of the time, cost and effort that will be required
IAS 12 when preparing financial statements as the rules are to assess the accounting implications associated with the tax
phased in. consequences arising from the implementation of the Pillar Two
• additional disclosure requirements – these are targeted at Model Rules.
a reporting entity’s exposure to income taxes arising from
the OECD reforms in periods in which the Pillar Two Model
legislation is enacted or substantively enacted but not yet
in effect. The aim of these disclosures is to help investors
with their understanding of the reporting entity’s exposure to
these tax reforms, particularly before any domestic offshore
legislation takes effect. The amendments provide guidance
on how this information could be disclosed to meet the
above objective.

International Tax Reform
– Pillar Two Model Rules
(Amendments to the IFRS
for SMEs)
In September 2023, the IASB amended the IFRS for SMEs for Commercial significance
the Pillar Two Model Rules. The amendments are based on
the amendments to IAS 12 issued in May 2023, and address
the impacts of the introduction of the OECD Pillar Two Model
Rules. The amendments introduce a temporary exception and Few
Number of
targeted disclosure requirements. entities affected
Following similar amendments to IAS 12, issued in May 2023,
the IASB has issued these ‘out-of-cycle’ amendments to the
IFRS for SMEs to provide direction on what they expect entities The Pillar Two Rules only apply to large multinational
to disclose. companies, the majority of which will apply full IFRS Accounting
Standards in their financial reporting.
The amendments
The amendments:
• introduce a temporary recognition exception for entities
applying the IFRS for SMEs from recognising deferred tax
Medium
Impact on
assets and liabilities arising from Pillar Two Model Rules,
and from the related disclosures on deferred tax assets and
affected entities
liabilities that would otherwise be required
• provides clarification on the disclosures required by entities
applying the IFRS for SMEs. This includes disclosing the The amendments will provide a significant saving to reporting
current tax expense/income arising from Pillar Two Model entities scoped into the rules in terms of the time, cost
Rules, and a statement that it has applied the exemption and effort that will be required to assess the accounting
from recognising deferred tax balances relating to Pillar implications associated with the tax consequences arising
Two Model Rules. from the implementation of the Pillar Two Model Rules.
Effective date and transition

Entities can benefit from this temporary exception immediately
and are required to provide the disclosures set out in the
amendments for reporting periods beginning on or after
1 January 2023.
‘The amendments are based on the amendments to IAS 12 issued

in May 2023, and address the impacts of the introduction of the
Organisation for Economic Co-operation and Development’s
(OECD) Pillar Two Model Rules.’

The Standards and Amendments discussed on pages 20 to 23

are effective for reporting periods beginning on or after
1 January 2024.
local legislation and the requirements of the particular change in
concern. The Standards are:
• Classification of Liabilities as Current or Non-current
• Non-current Liabilities with Covenants (Amendments to IAS 1)
• Lease Liability in a Sale and Leaseback (Amendments to
IFRS 16)
• Supplier Finance Arrangements (Amendments to IAS 7
and IFRS 7)

Classification of Liabilities
as Current or Non-current
In January 2020, the IASB published ‘Classification of Liabilities Effective date and transition
as Current or Non-Current (Amendments to IAS 1)’ which The amendments were initially effective from accounting
clarify the Standard’s guidance on whether a liability should periods beginning on or after 1 January 2022. However,
be classified as either current or non-current. the IASB decided to give entities more time to implement
any classification changes that may result from the above
IAS 1 requires an entity that has an unconditional right to delay amendments. As such in October 2022 the IASB changed the
settlement of a liability for at least 12 months from the end of effective date of the amendments and they are now effective
the reporting period, then it can be classified as non-current, if from 1 January 2024.
not it is classified as current. Some preparers have found this
statement confusing and consequently similar liabilities have The amendments should be applied retrospectively, with
been classified differently, making comparisons by investors entities being allowed to apply them to an earlier period,
difficult. as long as they disclose that they have done so.
The IASB therefore issued amendments to IAS 1 to clarify its Commercial significance
previously issued guidance and rectify the above issue.
The amendments
The amendments elaborate on guidance set out in IAS 1 by:
Many
Number of
• clarifying that the classification of a liability as either
current or non-current is based on the entity’s rights at the
entities affected
end of the reporting period
• stating that management’s expectations around whether
The amendments affect entities with borrowing arrangements
they will defer settlement or not does not impact the
so therefore the impact could be widespread.
classification of the liability
• adding guidance about lending conditions and how these
can impact classification
• including requirements for liabilities that can be settled
using an entity’s own instruments. Medium
Impact on
affected entities
These amendments could have a significant impact on an

entity’s presentation of their borrowings which in turn could
impact important financial ratios.

Non-current Liabilities with
Covenants (Amendments to
IAS 1)
In November 2022, the IASB issued some amendments to Commercial significance
IAS 1 that aim to improve disclosures about long-term debt
with covenants.
IAS 1 requires an entity to classify debt as current if it is unable

Many
Number of
to avoid settling the debt within 12 months after the reporting
date. However, the entity may need to comply with covenants
entities affected
during that same period, which may question whether the debt
should be classified as non-current. For example, a long-term
debt may become current if the entity fails to comply with the The amendments affect entities with borrowing arrangements
covenants during the 12-month period after the reporting date. so therefore the impact could be widespread.
The amendments
The amendments set out in ‘Non-current Liabilities with
Covenants (Amendments to IAS 1)’ state that at the reporting
Medium
Impact on
date, the entity does not consider covenants that will need
to be complied with in the future, when considering the affected entities
classification of the debt as current or non-current. Instead,
the entity should disclose information about these covenants
in the notes to the financial statements. These amendments could have a significant impact on an
entity’s presentation of their borrowings which in turn could
The IASB wants these amendments to enable investors to impact important financial ratios.
understand the risk that such debt could become repayable
early and therefore improving the information being provided
on the long-term debt.
The amendments are applicable for reporting periods

permitted. If the amendments are applied in an earlier period,
this should be disclosed. The effective date coincides with
that of the amendments to IAS 1 previously issued in 2020
‘Classification of Liabilities as Current or Non-current’. Refer
to page 20 for details of these amendments.
‘IAS 1 requires entities to classify debt as current if the entity

is unable to avoid settling the debt within 12 months after the
reporting date.’

Lease Liability in a Sale and
Leaseback (Amendments to
IFRS 16)
In September 2022, the IASB issued amendments to IFRS 16, Commercial significance
adding requirements for accounting for a sale and leaseback
after the date of the transaction.
The amendments
Some
Number of
The IASB has now issued additional guidance in IFRS 16 on
accounting for sale and leaseback transactions. Previously
entities affected
IFRS 16 only included guidance on how to account for sale
and leaseback transactions at the date of the transaction
itself. However, the Standard did not specify any subsequent The amendments affect entities accounting for a sale and
accounting when reporting on the sale and lease back leaseback transaction.
transaction after that date.
As a result, without further requirements, when the payments

include variable lease payments there is a risk that a
Low
Impact on
modification or change in the leaseback term could result in
the seller-lessee recognising a gain on the right of use they affected entities
retained even though no transaction or event would have
occurred to give rise to that gain.
These amendments would only impact the subsequent
Consequently, the IASB decided to include subsequent accounting for a sale and leaseback transaction, while these
measurement requirements for sale and leaseback transactions amounts could be material, in most cases it is unlikely to have
to IFRS 16. a significant impact.
The amendments are applicable for reporting periods
permitted. If the amendments are applied in an earlier period,
this should be disclosed.
‘In September 2022, the IASB issued amendments to IFRS 16,

adding requirements for accounting for a sale and leaseback
after the date of the transaction.’

Supplier Finance
Arrangements (Amendments
to IAS 7 and IFRS 7)
In May 2023, the IASB amended IAS 7 ‘Cash flow Statements’ Commercial significance
and IFRS 7 ‘Financial Instruments: Disclosures’ through
the increase of disclosure requirements to enhance the
transparency of supplier finance arrangements and their
effects on an entity’s liabilities, cash flows and exposure to Some
Number of
liquidity risk. entities affected
The amendments
The amendments require additional disclosures that
complement the existing disclosures in these two Standards. The amendments apply to all entities that engage in supplier
They require entities to disclose: financing arrangements.
• the terms and conditions of the arrangement
• the amount of the liabilities that are part of the
arrangements, breaking out the amounts for which the
suppliers have already received payment from the finance Medium
Impact on
providers, and stating where the liabilities are included on affected entities
the statement of financial position
• ranges of payment due dates
• liquidity risk information.
The amendments will require new disclosures to be prepared
These additional disclosure requirements address investors with more detailed information provided on their supplier
wanting more visibility around supplier finance arrangements, finance arrangements. Depending on the complexity or volume
which in some jurisdictions around the world are better known of such arrangements this may result in significantly more
as reverse factoring arrangements. disclosures.

The amendments to IAS 7 and IFRS 7 are effective for reporting
periods commencing on or after 1 January 2024.
‘In May 2023, the IASB amended IAS 7 ‘Cash flow Statements’
and IFRS 7 ‘Financial Instruments: Disclosures’ through the
increase of disclosure requirements to enhance the transparency
of supplier finance arrangements and their effects on an entity’s
liabilities, cash flows and exposure to liquidity risk.’

The Amendment discussed on page 25 is effective for reporting

periods beginning on or after 1 January 2025.
local legislation and the requirements of the particular change in
concern. The Amendment is:
• Lack of Exchangeability (Amendment to IAS 21)

Lack of Exchangeability
In August 2023, the IASB amended IAS 21 ‘The Effects of Commercial significance
Changes in Foreign Exchange Rates’ to clarify the approach
that should be taken by preparers of financial statements when
they are reporting foreign currency transactions, translating
foreign operations, or presenting financial statements Few
Number of
in a different currency, and there is a long-term lack of entities affected
exchangeability between the relevant currencies.
The amendments
The amendments include both updates to guidance to assist These amendments only affect entities that are required to
preparers in correctly accounting for foreign currency items report foreign currency transactions where there is a long-term
and increases the level of disclosure required to help users lack of exchangeability between currencies.
understand the impact of a lack of exchangeability on the
financial statements. The amendments:
• introduce a definition of whether a currency is
exchangeable, and the process by which an entity should Medium
Impact on
assess this exchangeability. This includes application affected entities
guidance included in a new Appendix A
• provide guidance on how an entity should estimate a
spot exchange rate in cases where a currency is not
Affected entities may be required to adjust the carrying
exchangeable
value of any monetary items that have been translated from
• require additional disclosures in cases where an entity
a foreign currency which is not exchangeable, and will be
has estimated a spot exchange rate due to a lack of
required to provide additional disclosures on how the new spot
exchangeability, including the nature and financial impact
rate has been determined.
of the lack of exchangeability, and details of the spot
exchange rate used and the estimation process.
The additional disclosure requirements provide useful

information about the additional level of estimation
uncertainty, and risks arising for the entity due to the lack of
exchangeability.

The amendments to IAS 21 are effective for reporting periods
on or after 1 January 2025, with earlier application permitted.
‘In August 2023, the IASB amended IAS 21 ‘The Effects of Changes
in Foreign Exchange Rates’ to clarify the approach that should
be taken by preparers of financial statements.’

Grant Thornton’s IFRS
Publications
As well as the publications mentioned within the body of this publication, we also have a number of other publications including:
Reporting under IFRS – Example Interim Consolidated Reporting under IFRS – Example Consolidated Financial
Financial Statements 2023 Statements 2023
This publication illustrates the interim A set of illustrative consolidated financial IFRS
IFRS Example Interim

Condensed Consolidated
consolidated financial statements of a statements for existing preparers of IFRS. Assurance
Financial Statements 2023 IFRS Example

company that is an existing preparer of Consolidated Financial The latest version of this publication has
Global
with guidance notes

Statements 2023
IFRS and produces half-yearly interim with guidance notes

been reviewed and updated to reflect
reports in accordance with IAS 34 ‘Interim changes in IFRS that are effective for
Financial Reporting’ at 30 June 2023. annual periods ending 31 December 2023.
You can access this publication at www. You can access this publication at www.
grantthornton.global/en/insights/ grantthornton.global/en/insights/articles/
articles/ifrs-example-interim-consolidated- ifrs-example-consolidated-financial-
financial-statements-2023/. statements-2023/.
Under control? A practical guide to applying IFRS 10 Insights into IFRIC 23

consolidated financial statements IFRIC 23 specifies how entities should Accounting
This publication aims to assist management reflect uncertainty in accounting for income Tax
Insights into IFRIC 23

in understanding the requirements of IFRS 10 taxes. Our ‘Insights into IFRIC 23’ article
Global
‘Consolidated Financial Statements’ provides an overview of the interpretation

What is the issue?
Under control? Effective for financial years beginning on or after 1 January 2019, IFRIC 23 ‘Uncertainty
Over Income Tax Treatments’ (‘the Interpretation’) requires entities to consider the
potential for adverse tax determinations being made by taxing authorities while under
a hypothetical tax review – and record a liability (and expense) where such a finding
A practical guide to applying IFRS 10 is considered “probable”. Many entities may not experience a financial impact as a
on control and consolidation as well as and some practical guidance for when
result of this, but the Interpretation remains applicable and certain disclosures may
Consolidated Financial Statements

be appropriate.
Overview
February 2017
identifying and addressing the key practical applying it. You can access this publication
Preparers are expected to apply the tax rules in good faith. For each individual tax treatment identified, the process
This Interpretation expands on this principle and requires an is relatively simple, but first it is important to understand
entity to record a liability where it is considered probable that its scope.
an uncertain tax treatment that affects the determination
of taxable income, tax bases, unused tax losses, unused tax • What income taxes does IFRIC 23 apply to?
credits and tax rates, would not be resolved in favour of the • What is a tax treatment?
entity if it were to be reviewed by a taxation authority. • What is meant by uncertainty?
• What is a taxation authority?
application issues and judgements. You at www.grantthornton.global/en/insights/

can access this publication at www. articles/insights-into-ifric-23/.
grantthornton.global/en/insights/articles/
under-control-applying-ifrs-10/.
Insights into IFRS 13 Insights into IFRS 16

Our Insights into IFRS 13 article not only Our Insights into IFRS 16 series looks at
summarises the Standard, it also provides key areas of the new Standard and aims to
Accounting Accounting
Advisory Tax
Insights into IFRS 16

Insights into IFRS 13 detailed commentary on various aspects of provide assistance in preparing for IFRS 16.
Global Global
applying this Standard from the perspective The key areas covered in the series are:
Fair Value Measurement Understanding the discount rate
Under IFRS 16 ‘Leases’, discount rates are used to determine A lessee will need to determine a discount rate for virtually
the present value of the lease payments used to measure every lease to which it applies the lessee accounting model
a lessee’s lease liability. Discount rates are also used to in IFRS 16. However, a discount rate may not need to be
determine lease classification for a lessor and to measure a determined for a lease if:
lessor’s net investment in a lease. • a lessee applies the recognition exemption for either a short-
of a preparer working alongside a valuation

term or a low-value asset lease
For lessees, the lease payments are required to be discounted
• Understanding the discount rate

• all lease payments are made on (or prior to) the
using:
commencement date of the lease, or
• the interest rate implicit in the lease (IRIL), if that rate can be • all lease payments are variable and not dependent on an
readily determined, or index or rate (eg, all lease payments vary based on sales or
• the lessee’s incremental borrowing rate (IBR). usage).
For lessors, the discount rate will always be the interest rate The interest rate implicit in the lease may be similar to the
implicit in the lease. lessee’s incremental borrowing rate in many cases. Both rates
expert. You can access this publication at

consider the credit risk of the lessee, the term of the lease, the
The interest rate implicit in the lease is defined in IFRS 16
• Interim periods
security and the economic environment in which the transaction
as ‘the rate of interest that causes the present value of (a)
occurs.
the lease payments and (b) the unguaranteed residual value
to equal the sum of (i) the fair value of the underlying asset
and (ii) any initial direct costs of the lessor.’
The lessee’s incremental borrowing rate is defined in

IFRS 16 as ‘the rate of interest that a lessee would have to
www.grantthornton.global/en/insights/
pay to borrow over a similar term, and with a similar security,
• Definition of a lease
the funds necessary to obtain an asset of a similar value to
the right-of-use asset in a similar economic environment’.
The incremental borrowing rate is determined on the

commencement date of the lease. As a result, it will incorporate
the impact of significant economic events and other changes
in circumstances arising between lease inception and
commencement.
articles/ifrs-13/. • Lease term

• Transition choices
• Sale and leaseback accounting
• Lease payments
• Presentation and disclosure
• Lease incentives
You can access these publications at www.grantthornton.
global/en/insights/ifrs-16/.

Insights into IAS 36 Insights into IFRS 2
The articles in our ‘Insights into IAS 36’ Share-based payments are increasingly
series have been written to assist popular, however IFRS 2 is a Standard
Accounting
Advisory
Insights into IAS 36 Insights into

preparers of financial statements and IFRS 2 that remains not well understood. Our
Global
those charged with the governance ‘Insights into IFRS 2’ series sets out the
Overview of the Standard What is IFRS 2?
IAS 36 ‘Impairment of Assets’ is not a new Standard, and while many of its IFRS 2 ‘Share-based Payment’ was introduced in 2004 and the accounting principles
requirements are familiar, an impairment review of assets (either tangible or have remained largely unchanged since. Our ‘Insights into IFRS 2’ series is aimed at
intangible) is frequently challenging to apply in practice. This is because demystifying the Standard by explaining the fundamentals of accounting for share-
IAS 36’s guidance is detailed, prescriptive and complex in some areas. based payments using relatively simple language and providing insights to help
of reporting entities understand the key considerations when applying the

The articles in our ‘Insights into IAS 36’ series have been written to assist entities cut through some of the complexities associated with accounting for these
preparers of financial statements and those charged with the governance of types of arrangements. This article provides an overview including the objective and
reporting entities understand the requirements set out in IAS 36, and revisit scope of IFRS 2.
some areas where confusion has been seen in practice.
Share-based payments have become increasingly popular over the years, with many entities using equity instruments or cash
and other assets based on the value of equity instruments as a form of payment to directors, senior management, employees and
This article provides an ‘at a glance’ overview of IAS 36’s main • how to perform the quantitative impairment test by
other suppliers of goods and services.
requirements and outlines the major steps in applying those estimating the asset’s (or CGU’s) recoverable amount
requirements set out in IAS 36, and Standard. The key topics covered are:
requirements. • how to recognise and reverse an impairment loss The accounting of share-based payments is an area that remains not well understood and this is evidenced by a number of
• when and under what circumstances an entity must reverse Interpretations and agenda decisions being issued by the IFRS Interpretations Committee (IFRIC). Considerable care needs to be
Objective of IAS 36 an impairment loss, and applied in evaluating the requirements set out in IFRS 2 and other authoritative guidance to increasingly complex and innovative
The objective of IAS 36 is to outline the procedures an entity • the detailed disclosure requirements (both in the case of share-based payment arrangements.
should apply to ensure the carrying values of all its assets are impairment and also in the absence of impairment).
not stated above their recoverable amounts (the amounts to be
recovered through use or sale of the assets). To accomplish this
objective, IAS 36 provides guidance on:
revisit some areas where confusion has

• the level at which to review for impairment (eg individual
• What is IFRS 2?
asset level, cash-generating units (CGU) level or groups
of CGUs)
Why use share-based payments
• if and when a quantitative impairment test is required,
including the indicator-based approach for an individual One of the most persuasive reasons is that share-based are unable to raise traditional debt funding and therefore
asset that is not goodwill, an indefinite life intangible asset
payments allow entities to better align the interests of their might pay their employees and suppliers using share-based
or intangible asset not yet ready for use
employees with those of the shareholders. By remunerating payment arrangements. In fact, it is often the only viable
employees using shares, share options and other equity payment method available to such entities.
been seen in practice. The key topics

instruments, entities are able to incentivise their employees to
• Classification of share-based payment

act in the best interest of the business and create long-term Share-based payments are also of significant concern
shareholder wealth. to investors as they dilute the value of their existing
shareholdings. Accordingly, there is generally increased
In addition, share-based payments are an attractive payment shareholder interest and scrutiny on accounting for share-
method for entities that have cash flow issues but need to based payment transactions and the associated disclosures.
attract and retain highly qualified and talented people for the
development of their business. For example, many exploration
and start-up companies often have cash flow issues or
covered are: transactions and vesting conditions

• Overview of the Standard
Coming soon to this series:
• Scope and structure
• Basic principles of share-based payment arrangements with
• Undertaking an impairment review
employees
• Identifying cash generating units
• Equity-settled share-based payment arrangements with
• Allocating assets to cash generating units
employees
• Allocating goodwill to cash generating units
• Group share-based payment arrangements with employees
• Estimating the recoverable amount
• Modifications and cancellation of share-based payment
• Value in use estimating future cash flows
arrangements with employees
• Value in use – applying the appropriate discount rate
• Cash-settled share-based payment arrangements with
• Comparing recoverable amount with carrying amount
employees
• Recognising impairment losses
• Employee share-based payment arrangements with
• Reversing impairment losses
settlement alternatives
• Other impairment issues
• Presentation and disclosure requirements
• Presentation and disclosure
• Share-based payments with non-employees
You can access these publications at www.grantthornton.global/
global/en/insights/articles/IFRS-ias-36/.
en/insights/articles/ifrs-2-insights/insights-into-ifrs-2/.

Our ‘Insights into IFRS 8’ series considers Accounting
Our ‘Insights into IFRS 3’ series summarises
some key implementation issues and the key areas of the Standard, highlighting
Accounting
Advisory Advisory

includes interpretational guidance in aspects that are more difficult to interpret
Global Global
certain problematic areas. We also include and revisiting the most relevant features that
Entity-wide disclosures The acquisition method at a glance
Generally, financial information is required to be reported on the same basis as Mergers and acquisitions (business combinations) can have a fundamental
is used internally for evaluating operating segment performance and deciding impact on the acquirer’s operations, resources and strategies. For most
how to allocate resources to operating segments. IFRS 8 ‘Operating Segments’ entities such transactions are infrequent, and each is unique. IFRS 3 ‘Business
sets out these requirements and asks for reconciliations of total reportable Combinations’ contains the requirements for these transactions, which are
segment revenues, total profit or loss, total assets, liabilities and other amounts challenging in practice. The Standard itself has been in place for more than ten
several examples illustrating the Standard’s could impact your business. The key topics
disclosed for reportable segments to corresponding amounts in the entity’s years now and has undergone a post implementation review by the IASB. It is
financial statements. one of the most referred to Standards currently issued.
Our ‘Insights into IFRS 8’ series is designed to illustrate how Our ‘Insights into IFRS 3’ series summarises the key areas of
IFRS 8 should be applied and it provides guidance and insight the Standard, highlighting aspects that are more difficult to
in some problematic areas. We also provide several examples interpret and revisiting the most relevant features that could
requirements. The key topics covered are: covered are:

illustrating the Standard’s disclosure requirements. This article impact your business.
sets out the requirements for entity-wide disclosures.
This article provides a high-level overview of IFRS 3 and
IFRS 8 requires entities within its scope (including those entities explains the key steps in accounting for business combinations
with only one reportable segment) to make certain product and in accordance with this Standard. It also highlights some
service and geographical disclosures for the entity as a whole practical application issues dealing with:
rather than by reportable segment. These are referred to as • deal terms and what effect they can have on accounting
entity-wide disclosures. Entity-wide disclosures are particularly for business combinations and
useful when the segment disclosures do not otherwise include • how to avoid unintended accounting consequences
total revenues by product, service or revenue stream. This will when bringing two businesses together.
• Principles in brief • The acquisition method at a glance

be the case when different reportable segments sell the same
product or service, and when reportable segments are not
organised by geographic area. These disclosures are based on
amounts incorporated in the consolidated primary financial
statements rather than a management basis.
• Identifying operating segments • Identifying a business combination

• Aggregation of operating segments • Identifying the acquirer
• Reportable segments • Identifying the acquisition date
• Segment information to be disclosed • The definition of a business
• Entity wide disclosures • Reverse acquisitions explained
• Other application issues and Standards involving operating • Reverse acquisitions in the scope of IFRS 3
segments • Recognition principles
• Disclosures for annual financial statements • How are the identifiable assets and liabilities measured?
• Disclosures for interim financial statements • Specific recognition and measurement provisions
• Recognising and measuring non-controlling interest
You can access these publications at www.grantthornton.global/
• Consideration transferred
en/insights/articles/ifrs-8/insights-into-ifrs-8/.
• Determining what is part of a business combination
transaction
Coming soon to this series:
• Recognising and measuring goodwill or gain from a bargain
purchase
• Accounting after the acquisition date
• Disclosures under IFRS 3: Understanding the requirements
• Accounting when the business combination is incomplete at the
reporting date
global/en/insights/articles/ifrs-3-insights/insights-into-ifrs-3/.

IFRS Viewpoints
We have released a series of publications Accounting for cryptocurrencies – the basics – This issue
providing insights on applying IFRS in explores the acceptable methods of accounting for holdings in
Accounting
Tax
challenging situations. Each edition focuses cryptocurrencies while touching upon other issues that may be
Global
IFRS Viewpoint
Related party loans at below-market interest rates
on an area where the Standards have encountered in this area.
What’s the issue?
proved difficult to apply or lack guidance.
Accounting for crypto assets – mining and validation issues –
Loans are one type of financial instrument. As such they are governed by
IFRS 9 (2014) ‘Financial Instruments’ which requires all financial instruments to be
initially recognised at fair value. This can create issues when loans are made at
below-market rates of interest, which is often the case for loans to related parties.
Normally the transaction price of a loan (ie the loan amount) will represent its
fair value. For loans made to related parties however, this may not always be the
Related party loans at below-market This issue seeks to explore the accounting issues that arise for
case as such loans are often not on commercial terms. Where this is the case, the
fair value of the loans must be calculated and the difference between fair value
and transaction price accounted for. This IFRS Viewpoint provides a framework
for analysing both the initial and subsequent accounting for such loans. Common
examples of such loans include inter-company loans (in the separate or
individual financial statements) and employee loans.
interest rates – This IFRS Viewpoint released miners and validators in mining and maintaining the blockchain
Our ‘IFRS Viewpoint’ series provides insights from our global
IFRS team on applying IFRSs in challenging situations. Each
edition will focus on an area where the Standards have proved
difficult to apply or lack guidance.
Relevant IFRS
provides a framework for accounting for in accordance with existing IFRS.

IFRS 9 (2014) Financial Instruments
IFRS 2 Share-based Payment
IAS 24 Related Party Disclosures
IAS 19 Employee Benefits
loans made by an entity to a related party

Accounting for client money – This issue provides guidance on
that are at below-market levels of interest.
client money – arrangements in which a reporting entity holds
Inventory discounts and rebates – This issue addresses how funds on behalf of clients.
a purchaser accounts for discounts and rebates when buying
Configuration or customisation costs in a cloud computing
inventory. Accounting for these discounts and rebates will vary
arrangement – This issue discusses the IFRIC’s agenda
depending on the type of arrangement.
decision addressing how a customer should account for costs
Common control business combinations – This issue addresses of configuring or customising a supplier’s application software
how to account for a common control business combination. in a Cloud Computing or Software as a Service (SaaS)
arrangement.
Reverse acquisitions outside the scope of IFRS 3 – This issue
considers how to account for a reverse acquisition outside the You can access these publications at www.grantthornton.
scope of IFRS 3. global/en/insights/viewpoint/ifrs-viewpoints-hub/.
Preparing financial statements when the going concern basis
is not appropriate – This issue provides guidance on the issues
encountered when an entity determines that it is not appropriate
to prepare its financial statements on a going concern basis.
If you would like to discuss any of these publications, please speak to your usual Grant Thornton contact or visit
www.grantthornton.global/locations to find your local member firm.

© 2024 Grant Thornton International Ltd. All rights reserved.
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and
advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton
International Ltd (GTIL) and the member firms are not a worldwide partnership. GTIL and each member firm is a
separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL
and its member firms are not agents of, and do not obligate, one another and are not liable for one another’s acts
or omissions.
grantthornton.global

IFRS Changes 2024

Uploaded by

Copyright:

Available Formats

IFRS Changes 2024

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

IFRS Changes 2024

Uploaded by

Copyright:

Available Formats

Navigating the changes

Navigating the changes to IFRS – 2024 Edition

Effective dates of new Standards (based on Standards issued at 31 December 2023) 04

Effective from 1 January 2022 05

Navigating the changes to IFRS – 2024 Edition 1

2 Navigating the changes to IFRS – 2024 Edition

This publication is designed to give preparers and reviewers

Grant Thornton International Ltd

Navigating the changes to IFRS – 2024 Edition 3

Based on Standards issued at 31 December 2023

References to the Conceptual Framework (Amendments

Effective for the

Effective for the

IFRS 1, IFRS 9, Annual Improvements to IFRS Standards 2018-2020 Cycle

Insurance Contracts 1 January 2023

Extension of the Temporary Exemption from Applying IFRS 9

Effective for the first time

Effective for the first time

Not yet effective

Not yet effective

IAS 8 Definition of Accounting Estimates (Amendments to IAS 8) 1 January 2023 ✓

International Tax Reform – Pillar Two Model Rules

International Tax Reform – Pillar Two Model Rules

Classification of Liabilities as Current or Non-current

Not yet effective

Not yet effective

Not yet effective

Not yet effective

IAS 1 Non-current Liabilities with Covenants (Amendments to IAS 1) 1 January 2024 ✓

Supplier Finance Arrangements (Amendments to IAS 7

IAS 21 Lack of Exchangeability (Amendments to IAS 21) 1 January 2025 ✓

4 Navigating the changes to IFRS – 2024 Edition

The Amendments mentioned on pages 6 to 7 are effective for

Navigating the changes to IFRS – 2024 Edition 5

Standard affected Subject IASB’s summary of amendment

‘The collection includes amendments to three Standards as well

6 Navigating the changes to IFRS – 2024 Edition

Standard affected Subject IASB’s summary of amendment

 emoves a requirement to exclude cash flows from taxation when measuring

The amendments make changes to relatively narrow areas

The amendments and the IASB’s Annual Improvements process

Navigating the changes to IFRS – 2024 Edition 7

The Standards discussed on pages 9 to 18 are effective for

8 Navigating the changes to IFRS – 2024 Edition

Navigating the changes to IFRS – 2024 Edition 9

10 Navigating the changes to IFRS – 2024 Edition

Disclosure Effective date and transition

‘IFRS 17 solves the comparison problems created by IFRS 4

Navigating the changes to IFRS – 2024 Edition 11

The amendments include guidance on the recognition of insurance acquisition

The amendments clarify the application of contractual service margin (CSM)

The amendments extend the risk mitigation option to include reinsurance

The amendments clarify the application of IFRS 17 in interim financial

The amendments require an entity that at initial recognition recognises losses

The amendments require an entity to present separately in the statement of

12 Navigating the changes to IFRS – 2024 Edition

publication entitled ‘Insights into IFRS

This publication examines the scope of the Standard Introduction

This publication sets out the key factors

that non-insurance entities will need to “The articles in our ‘Insights

Effective dates of new Standards (based on Standards issued at 31 December 2023) 04

Effective from 1 January 2022 05

emoves a requirement to exclude cash flows from taxation when measuring

• Classification of share-based payment