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IFRS-impact & Its-implementation Services

IFRS implementation has a huge impact on several aspects of a company, including financial reporting systems, taxes, treasury, cash management, and more. Since it requires a change that comprises employees, processes, and systems, IFRS impact assessment & implementation is a tremendous task for companies in the UAE. CDA is an all-in-one solution to assist companies to implement IFRS Impact Assessment in UAE considering the requirements of your business.

ifrs impact and its implementation services in dubai

IFRS-impact & Its-implementation Services In Dubai, UAE

The recently applied International Financial Reporting Standards (IFRS) have impacted the UAE companies to a large extent. Many firms started the application process late and are now trying to pull alongside.

These new standards are causing a lot of precariousness in terms of both income statement and balance sheet presentation. 

IFRS standards are International Financial Reporting Standards that encompasses a set of accounting titles that decide how transactions and other accounting procedures are required to be entered in financial statements. It is steered when new-fangled or revised accounting standard is executed in any business from a precise time.

The importance of IFRS impact assessment 

So as to comply with the necessity of new challenges in the economy or for better performance of the financial statements, the International Accounting Standards Board (IASB) issues new IFRS or reissue the existing standards with suitable modifications.

IFRS Standards are very significant to businesses all over the world because it is a source of generally equivalent statistics. It pays to economic efficacy and helps investors recognize chances and risks across the world to improve capital distribution. IFRS sends general guidelines for the footing of monetary statements.

It is imperative to begin IFRS impact assessment as it needs: -

  • to report to the stakeholders
  • to report to the public
  • to get a judicious idea on the effect of the new or revised IFRS before closing the financial year.

The information required to conduct IFRS Impact Assessment

The following information are required to conduct the IFRS Impact Assessment: - 

  • Accounting manuals
  • Audited financials for the last two financial years
  • Details of Financial Assets & Liabilities
  • Details of agreements or contracts with the clients of the company
  • Details of relevant Invoices
  • Details of contract revenue
  • Other pertinent information if any and supporting documents

The Role of CDA in the IFRS-Impact & Its-Implementation Services.

CDA experts deal with the following three big IFRS accounting canons that have hit UAE companies recently and caused unpredictability.

  • IFRS 9 that deals with Financial Instruments Impact Assessment
  • IFRS 15 which deals with Revenue from Contracts with Customers Impact assessment 
  • IFRS 16 that covers Leases Impact assessment

a) IFRS 9 Financial Instruments Impact Assessment:

IFRS 9 is an International Financial Reporting Standard issued by the International Accounting Standards Board (IASB). It reports about the accounting for financial instruments. The IAS 39 Recognition and Measurement is replaced with IFRS 9 standards.

IFRS 9 encompasses three main topics: -

  • Classification and measurement of financial instruments
  • Impairment of financial assets
  • Hedge accounting

IFRS 9 presents a rational approach for: -

  • the classification of financial assets, which is controlled by cash flow characteristics
  • the business model in which an asset is held and applicable to business in all industry segments in general.

CDA professionals cover the following areas for the IFRS 9 Financial Instruments Impact Assessment

  • Cataloging and measurement of Financial Assets 
  • Cataloging and measurement of Financial Liabilities
  • The changes in the financial statements once the IFRS 9 is applied
  • The retrospective effect on previous year financial statements
  • Detailed analyses of accounts where the effect comes, and its effect on the profit of the company 
  • Disclosure of necessities according to the standard.

b) IFRS 15 Impact Assessment 

IFRS 15 is an International Financial Reporting Standard addressed by the International Accounting Standards Board. It provides guidelines on accounting for revenue from contracts with customers. It became effective in January 2018.

The IFRS 15 revenue model has five steps: -

  • Recognize the contract with a customer

  • Recognize all the individual performance obligations within the contract

  • Decide the transaction price

  • Distribute the price to the performance obligations

  • Identify revenue as the performance obligations are fulfilled

CDA experts take over the following areas for the IFRS 15 Impact Assessment.

  • Application of IFRS 15 and analyses report for the accounts where the effect comes, and its effect on profit
  • The retrospective effect on previous year Retained earnings
  • Study of negative impacts if the new IFRS 15 not applied in audited financial statements
  • Effect of IFRS 15 on contracting company, and find ways to overcome the loss occurred because of this implementation
  • Existing business operations and revenue streams 
  • Distinguishing the contract with customers
  • Evaluating if the performance obligations are happening at an exact point in time or over a period of time-based on the standards as per IFRS 15 
  • Verifying acknowledgment of contract costs
  • Verifying apportionment of transaction price 
  • Distinguishing the timing of revenue recognition
  • Checking and examining need of further modification in the contract with clients to stick to IFRS 15.
  • Suggesting disclosure prerequisites according to new standards 
  • Training the staff and management, if obligatory

c) IFRS 16 Impact Assessment 

IFRS 16 is an International Financial Reporting Standard addressed by the International Accounting Standards Board. It gives directions on accounting for leases. IFRS 16 was issued in January 2016 and is effective for most companies that report under IFRS since 1 January 2019. IFRS 16 replaced the earlier leasing standard, IAS 17.

The effect of IFRS 16 standard: -

  • It will ensure necessary transparency on companies’ lease, assets and liabilities.
  • It will improve comparability between companies that lease and those that borrow to buy.

CDA connoisseurs manages the following areas for the IFRS 16 Impact Assessment: -

  • Assuming an impact assessment of IFRS 16 on existing business operations
  • Whether the company has possessed any property, plant or equipment from a third party. 
  • Whether the company has rented any property, plant or equipment from a third party.
  • Whether the company has given any asset on lease to other party
  • Appraisal of lease accounting if needed
  • Repayment of Lease if any
  • Suggesting disclosure prerequisites according to new standard
  • Training the staff and management, if necessary 
  • Endorsing variations needed for operating and accounting environment
  • Endorsing changes needed for the vicissitudes in software.

Why CDA Accounting & Bookkeeping Services LLC

The execution of the new IFRS standards has been a huge task for companies in UAE to adopt because many had not started the process early. It means that there is a lot of work to be done by the end of the year rather than throughout the period. It also necessitates a lot of work from the IT side. Several organizations have been caught unprepared by the signature, scale, timing, and degree of the changes. 

CDA experts are a one stop solution for this problem. CDA’s well qualified and certified professionals can take care of these areas and handle the situation in a better way to solve those issues that you face in the implementation process of IFRS according to the nature and needs of your business. 

We broadly support our clients with meeting the IFRS reporting necessities and upholding and developing the related practices.

CDA Accounting & Bookkeeping Services LLC also efficiently handle CFO Services, Auditing Services, Accounting & Bookkeeping Services, Accounting Software services, Due Diligence Services, and Tax Filing & VAT Consultancy services in Dubai on time according to the convenience of our good clients. Our customer-centric approach is well appreciated, and we promise a better than the best service to your business. 

Feel good to contact us. CDA is always there for your succour.

Our experts will give you one-hour Free Consultation to drive away your qualms!


 

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