Oct 29 2011

Measurement of off-balance sheet commitments

Category: GuidanceFinancial Translator @ 10:08 am

When specific disclosures are required under a particular International Financial Reporting Standard, the measurement methods applicable to these disclosures are generally set out in that standard, such as for example:
–  finance leases IAS17:

  • schedule of minimum future payments (i.e. excluding contingent rent, cost of services and taxes payable) and of their present value;
  • contractual terms and conditions of the main leases and in particular the method for calculating contingent rent and implementation of renewal options;

–        operating leases IAS 17: schedule of minimum future payments.

–        contingent liabilities IAS 37: the potential financial impact must be determined using the same principles as those applied to calculate provisions (see paragraphs 36 to 52 of the standard); in particular the amounts presented should thus theoretically be discounted;

–        carrying amount of inventories pledged as security for liabilities (IAS2.36 (h));

–        contractual commitments arising from the purchase of property, plant and equipment (a priori corresponding to the historical cost of the asset excluding direct purchase costs);

–       fair value of collateral held as security for loans granted to third parties that are impaired or past due (see IFRS7.37 (c));

–        fair value of financial and non-financial assets held as collateral that the issuer can sell or re-use as collateral (IFRS7.15 or IAS 32.94);

–        carrying amount of financial assets pledged as collateral or of contingent liabilities (IFRS7.14 or IAS 32.94).

Where the measurement of a commitment is complex and depends on changes in future parameters, the AMF recommends specifying the minimum or maximum amount, so long as they are specified or reference is made to the full description of the commitment in question.


Tags: IFRS, Off-balance sheet commitments

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