Category: INTERNATIONAL ACCOUNTING STANDARD

Identify and describe the types of differences that exist between IFRS and U.S.

Identify and describe the types of differences that exist between IFRS and U.S. GAAP.
Foreign companies whose stocks are listed on United States Stock Exchanges are required to file Form 20-F reconciliations with the Securities and Exchange Commission if they prepare their consolidated financial statements in accordance with any standards different from current U.S. GAAP or IFRS.
Prior to 2014, AngloGold Ashanti prepared their annual audited consolidated financial statements contained in the annual report on Form 20-F for years ending on or before December 31, 2012, in accordance with U.S. GAAP. However, the company made a change in 2014 and prepared the annual audited consolidated financial statements contained in the annual report on Form 20-F for the year ending December 31, 2013, in accordance with IFRS as issued by the IASB.
For this assignment, you are going to analyze the differences in the year ending 12/31/2012 figures found in the 2012 and 2013 Form 20-F Reconciliations.
Download the 2013 Form 20-F and the 2012 Form 20-F using the links below.
2013 Form 20-F
AngloGold Ashanti Limited. (2013). Form 20-F. https://www.sec.gov/Archives/edgar/data/1067428/000119312514141938/d709051d20f.htm
2012 Form 20-F
AngloGold Ashanti Limited. (2012). Form 20-F. https://www.sec.gov/Archives/edgar/data/1067428/000119312513175850/d508552d20f.htm
Compare the 2012 financial data found in the 2013 Form 20-F with the 2012 financial data found in the 2012 Form 20-F Reconciliation. Analyze the differences in the key financial indicators used by financial analysts and comment on your findings. Make sure you include, at a minimum, answers to the following questions in your analysis.
What is the difference between IFRS revenues and U.S. GAAP revenues for 2012? Use the percent difference to help highlight the significance.
What is the difference between IFRS net income and U.S. GAAP net income for 2012? Use the percent difference to help highlight the significance.
What is the difference between IFRS current assets and U.S. GAAP current assets? Use the percent difference to help highlight the significance.
What is the difference between IFRS total stockholders’ equity and U.S. GAAP total stockholders’ equity? Use the percent difference to help highlight the significance.
How might these differences influence investor decisions and financial analysts’ assessment of the company? Consider using financial ratios to support your answer.
Which method would the AngloGold Ashanti management prefer to report to stakeholders? Why?
How is an impairment loss on property, plant, and equipment determined and measured under IFRS? How does this differ from U.S. GAAP?
On 01/01/XX01 AI Inc entered into a contract to lease technology equipment from IBM for 3 years. The lease agreement requires AI to pay $60,000 at the end of each year of the lease. The company’s borrowing rate is 8%. Under U.S. GAAP, the lease would be classified as operating. However, AI is based in Slovenia and will account for the lease using IFRS 16.
Required:
Compute the value of the lease liability that AI will record under IFRS 16 on January 1, Year 1.
In each year of the lease, AI will record depreciation expense on the leasehold asset and interest expense on the lease obligation. Compute the amount of the two expenses in the lease’s first year.
How much expense would AI recognize for the lease if it were a U.S. company that reported it under U.S. GAAP, and how does this amount differ from the total lease expense recognized under IFRS?
How will the lease affect operating cash flow, and how would it affect operating cash flow under U.S. GAAP? Assume that AI classifies interest paid as a financing flow in its statement of cash flows.
How do IFRS 16 and the new U.S. lease accounting standard, ASC 842, differ? Under ASC 842, are there disclosure requirements for reporting operating leases on a company’s balance sheet?

In what way is the IASB’s Framework intended to assist firms in preparing IFRS-b

In what way is the IASB’s Framework intended to assist firms in preparing IFRS-based financial statements? Would the worldwide adoption of IFRS result in worldwide comparability of financial statements? Why or why not?
600 words
APA format
NO COVER

Answer the following homework problems thoroughly and in complete sentences. 
Mo

Answer the following homework problems thoroughly and in complete sentences. 
Most developing economies allow IFRS for SMEs, but some countries do not. What are some possible reasons for reluctance to adopt IFRS for SMEs?
Access DRL’s annual report and 20-F for the 2019-20 fiscal year on the Investor Relations section of the company’s website (www.drreddys.com/investors/reports-and-filings). Answer the following questions using the company’s 2019-20 consolidated financial statements. Be sure not to use DRL’s parent-level statements, which are also included in the annual report.
Do the financial statements (prepared under Ind AS) presented comply with the presentation requirements in IAS 1, Presentation of Financial Statements? Support your answer.
Compare basic accounting figures in the Ind AS consolidated financial statements of the annual report with the consolidated financial statements of the 20-F prepared using IFRS. More specifically, compare total revenue, after-tax income (profit and loss), and operating cash flow under both systems for fiscal 2019-20 and fiscal 2018-19. Then compare the value of total assets and shareholders’ equity under both systems as of March 31, 2020 and March 31, 2019.
Based on your analysis immediately above, do the differences seem material?
Which system is more conservative in how it determines profit and loss, operating cash flow, the value of total assets, and the value of shareholders’ equity?
Discuss the nature and purpose of IFRS 1 and its predecessor, IAS 1.
Identify at least three different ways that IFRS might be used within a country and discuss how this impacts the ultimate goal of the IASB?
double-spacing, 12-point Times New Roman or Arial font, one-inch margins, APA in-text citations and an APA reference list. Page length requirements: 2–3 pages, not counting title page and reference list page.

In your opinion, would a principles-based approach to standard setting or a rule

In your opinion, would a principles-based approach to standard setting or a rules-based approach to standard setting produce more reliable financial statements? What are the biggest hurdles impeding transition to IFRS in the United States?
600 words
APA  format
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Choose one of the following questions and respond:
Do you think it is important

Choose one of the following questions and respond:
Do you think it is important to separate the evaluation of a subsidiary’s performance from that of its manager? Why?
How do companies decide whether a foreign operation will be evaluated as an investment center, a profit center, a cost center, or a revenue center?
600 words
APA format
NO COVER

Why is it important in countries with high inflation that financial statements b

Why is it important in countries with high inflation that financial statements be adjusted for inflation? Consider understated asset values, understated expenses, overstated income, and overstated equity and how these may affect a company’s overall strategy when responding. What procedures does IFRS require when translating the foreign currency financial statements of a foreign operation located in a hyperinflationary economy?
600 words
APA format
NO COVER