Teaching plan of International Financial Reporting 2021-22

 

Teaching plan of International Financial Reporting (APC311).

Intake: BAAFM 53-55                  Assignment due date: Jan 7, 2022

 

Date	Topics	Readings
1.    Oct 29 (Friday) Time: 19-22 (online)	·          Introduction: The regulatory and conceptual framework of accounting ·          Briefing on the subject and the module guide	Alexander et al., 2014: 1 & 2.  Videos: 1a. What is accounting standard, what is accounting policy and accounting principles. 1b. The accounting concepts of prudence,  materiality, consistency, business entity, cost, substance over form, accruals and matching, and realisation. 1c. What is IFRS. (also watch IFRS - an introduction). 1d. IFRS standard setting process. 1e. Regulatory bodies of IFRS [CIMA lecture briefing]. 1f. How IFRS are developed. 2a. IFRS framework. (also see (i) IASB conceptual framework, (ii) First time adoption [IFRS1], ACCA lecture, and (iii) revised IFRS conceptual framework [IFRS foundation]. 2b. Accounting principles of GAAP and IFRS. 2c. Going concern assumption applies in IFRS. 3. GAAP vs non-GAAP.  4a. Differences between GAAP and IFRS. 4b. GAAP vs IFRS in valuation and financial modeling (some concrete examples for illustration; relatively detailed). 5a. For and against IFRS. (also watch: standardization vs harmonisation). 5b. Challenges caused by accounting diversity (also watch "reasons for accounting diversity"). 6. IASB (a briefing). Also watch International Federation of Accountants (IFAC). 7a. IFRS 13 on fair value measurement. (also watch fair value lecture [ACCA]). [another brief lecture on fair value measurement]. 7b. Relevance and faithful representation as fundamental qualitative characteristics of financial reporting. 8. Accounting standard harmonization. 9. IFRS: standardization vs harmonization. 10. How IFRS improve comparability. 11. Case study: convergence of accounting standards: India. e-readings 1. Difference between IAS and IFRS. (also read IAS/IFRS). 2. Top 10 differences between IFRS and GAAP accounting. 3. IFRS and the standard setting process. 4. What is the IASB? (Also read: IASC). 5. What are international accounting standards? 6. Advantages and disadvantages of IFRS vs GAAP? 7. Illustrative examples on IFRS 13 (Fair value measurement). 8. A note on the concept of "value in use". 9. A briefing on off-balance sheet financing. (also on a basic idea introduction). Slides: 1. On IFRS conceptual framework. About doing assignment: some basic writing skills: 1. on harvard referencing. 2. on plagiarism.
2.    Nov 5 (Friday) Time: 19-22 (online)	·          Corporate governance * Revision videos related to essay writing: a. Revision video on harvard referencing. [referencing skill is important for doing essay assignment] b. Revision video on "using quotations". [skill of quoting is important for doing essay assignment] c. Revision video on how to avoid plagiarism. d. How to paraphrase. * Lecture diagram	Alexander et al., 2014: 11 Videos: 1a. The basics of corporate governance. (also watch principles of corporate governance). 1b. The duties and responsibilities of a non-executive director. 2a. Corporate governance lecture. 2b. CIMA Corporate governance lectures: part 1; part 2. 2c. The OECD framework on corporate governance (ACCA). 2d. The Sarbanes Oxley Act of 2002. [Also note Sarbanes Oxley Act Section 404 about management responsibility of internal control audit over financial reporting]. 3. Corporate governance overview (ACCA). 4a. An introduction to Internal Control. (A related video on COSO). 4b. Corporate governance - financial reporting (ACCA). 4c. Corporate governance and fraudulent financial reporting. 4d. A briefing on the Audit Committee. 5. Corporate governance and financial statement notes & disclosures. 6a. The Enron Scandal - a simple overview. 6b. The Satyam Scandal. 6c.  Toshiba Accounting Scandal - a case study. 6d. The Tesco accounting scandal - a case study. Slides: 1. on corporate governance. e-reading: 1. An article on financial reporting and corporate governance (pdf). 2. World corporate governance index. 3. Dual compliance on HKFRS and IFRS (A Plus pdf). 4. CEO vs Chairman: what are the differences. 5. Audit committee roles and responsibilities. 6. The different types of directors. 7. The responsibilities of directors from Company law (UK) standpoint.
3.    Nov 12 (Friday) Time: 19-22 (online)	·          Presentation and preparation of financial statements	Alexander et al., 2014: 10 Videos: 1a. IAS 1: presentation of financial statements. 1b. The elements of financial statements (CIMA lecture). 2. Presentation of financial statements (ACCA lecture). 3. Statement of comprehensive income (also watch Other comprehensive income in IFRS [a second one on OCI] and statement of changes in equity in IFRS). 4. The statement of financial position (IFRS). 5. The statement of cash flows in IFRS. 6. The notes to the financial statements. in IFRS. 7. IAS 10: adjusting and non-adjusting events. (also watch an ACCA lecture on this topic). 8. on creative accounting. 9. Statement of cash flows (CIMA lecture). 10. On the IFRS interpretation committee: its main function. 11. Regulatory environment of financial reporting (CIMA): a simple briefing. 12. The problem with historical cost. e-readings: 1. IAS 1: presentation of financial statements. 2. IAS 1: presentation of financial statements with examples. 3a. Setting HK Financial Reporting Standards: HKICPA (pdf). 3b. HKAS 1: presentation of financial statements (pdf). 4a. Case study: Rio Tinto Annual Report 2020 (pdf). 4b. Case study: Power Assets Holdings 2020 (pdf). 5. Definition of faithful representation. Slides: 1. IAS 1 presentation.
4.    Nov 19 (Friday) Time: 19-22 (online)	·          Tangible assets: Property, Plant & Equipment	Alexander et al., 2014: 13 Videos: 1. IAS 16 - property, plant and equipment. 2. IAS 16: CIMA lecture. 3a. PPE revaluation upwards (ACCA lecture). 3b. PPE revaluation downward (ACCA lecture). 4a. PPE revaluation model (with double-entry illustration). 4b. Accounting for revaluation of PPE. 4c. OCI and AOCI [some relatedness to PPE accounting]. 5. PPE depreciation (ACCA lecture). 6a. Also on IAS 36 - impairment of assets (summary). [also read note on "recoverable amount"). [Also watch a brief lecture on IAS 36(CIMA lecture)]. 6b. Recoverable amount. 6c. On carrying amount (a revision). 6d. Value in use calculation. 6e. Fair value [related also to PPE]. 7. Government grant (IAS 20) on depreciable assets. 8. Treatment of borrowing costs (IAS 23). [also refer to IAS 23 note]. 9. IAS 16 : derecognition. 10. Capital maintenance concept [ACCA lecture]. Revision videos: 1. Depreciation methods (another briefing on depreciation). 2. Depreciation methods with examples. e-readings: 1. IAS 16 - a summary. 2. IAS 16 with examples of calculation. 3. IAS 16 : componentisation. 4. Principal issues with IAS 16. 5. IAS 36 - impairment of assets with illustrative examples. 6. Depreciation methods with examples for illustration. 7. Fixed asset accounting basics. 8. Some critical comments on IAS 16. 9. Capital maintenance definition. Slides: 1. IAS 16.
5.    Nov 20 (Sat) Time: 14-20 (online)	·          Intangible assets ·          Mid-term revision	Alexander et al., 2014: 14 Videos: 1. IAS 38: Intangible assets. [A brief description of intangible asset]. 2. IAS 38: a summary. [A more detailed description of IAS 38]. 3. IAS 38: subsequent measurement of intangible assets. 4a. Goodwill in accounting. 4b. Goodwill impairment single step test (also watch Impairment of goodwill assessment briefing (and then study the note on impairment of assets - goodwill).) [detailed lecture on goodwill calculation and goodwill impairment]. 4c. Cash generating Units - a briefing. 5. Development cost GAAP vs IFRS. (also watch internally developed intangible assets). 6. Group SFP - Goodwill (ACCA lecture). 7. Recognizing internally generated goodwill. 8. On intellectual capital. e-readings: 1. Study note on R&D [ACCA note]. [solution on the example] 2. IAS 38 note with illustrative examples. 3. IAS 38 illustrative examples. Slides: 1. IAS 38.
6.    Nov 26 (Friday) Time: 19-22 (online)	*** switch to topic 8: Provisions, contingent liabilities and assets * Revision videos related to essay writing: a. Revision video on harvard referencing. [referencing skill is important for doing essay assignment] b. Revision video on "using quotations". [skill of quoting is important for doing essay assignment] c. Revision video on how to avoid plagiarism. d. How to paraphrase. ·          Leases	Alexander et al., 2014: 16 Videos: 1a. Finance vs operating lease. 1b. IFRS 16 - a summary. (also watch a briefing on IFRS 16 and another brief overall description). 1c. IFRS 16: identifying a lease [ACCA lecture]. 2. Example on lease accounting [about right-of-use and lease liability]. 3. IFRS (leases) [ACCA lecture]. 4a. Lessor accounting [finance lease] (ACCA lecture). 4b. Lessor accounting [operating lease] [ACCA]. 5a. Lessee accounting (ACCA lecture). 5b. How to account for an operating lease [lessee's perspective]. 5c. Initial recognition of right of use asset [IFRS 16]. 5d. How to calculate the lease liability (lessee) [IFRS 16]. 5e. Guaranteed residual value (lessee's standpoint). 5f. Bargain purchase option (lessee's standpoint). 6. Standard differences discussion (covering IFRS). 7. Difference between IAS 17 and IFRS 16. Also study IAS 17: 1. IAS 17 - an introduction (ACCA). e-readings: 1. Study note on IFRS 16 [ACCA note]. 2. IFRS 16 note with illustrative examples. 3. How to calculate a lease liability and right-of-use asset under IFRS 16. Slides: 1. on IFRS 16.
7.    Dec 3 (Friday) Time: 19-22 (online)	·          Inventories and Construction Contracts ** Some suggestions on the assignment writing.	Alexander et al., 2014: 17 Videos:  1a. Inventory and construction contracts: a summary in a mind map. 1b. IFRS: construction contract. 1c. IAS 2 inventory - a summary. 1d. Prime costs and conversion costs. (a more detailed calculation). 2. IFRS 15: a simple explanation [on construction contract] . (also on a brief overview). 3. IAS 2 inventories (financial reporting) [CIMA]. 4. IAS 2 - inventory - simple explanation. 5a. How to calculate net realizable value of inventory. 5b. Inventory: IFRS vs GAAP. 6a. IFRS 15: Revenue from contracts with customers:  a summary. 6b. IFRS 15 with illustrative examples [more details]. 6c. IFRS 15 revenue recognition [ACCA lecture]. 6d. A briefing on contract and performance obligation [ACCA]. 6e. Revenue allocation [ACCA]. 6f. IFRS contract costs. 7. IFRS 15 about construction contracts. Revision videos: 1. Inventory accounting: FIFO and LIFO. e-reading: 1. IAS 2 - inventories [study note]. 2. IAS 2 inventories with exercises and answers (pdf). Slides: 1. on IAS 2.
8.    Dec 10 (Friday) Time: 19-22 (classroom) [Drop-in session; attendance will be taken]	·          Provisions, contingent liabilities and assets	Alexander et al., 2014: 20 Videos: 1. IAS 37: provisions, contingent liabilities and contingent assets. 2a. IAS 37: an ACCA lecture. [another ACCA lecture: additional info.] 2b. ACCA: specific provision scenarios [IAS 37]. 2c. IAS 37: restructuring provisions. 3. IAS 37 - decision tree. 4a. IAS 37: contingent assets. 4b. IAS 37: contingent liabilities. 4c. IAS: provisions. 5. IAS 37: provisions and other liabilities. [about provision vs accrual {on accrual accounting a/ on accrual accounting b: with a simple case study}] 6. Contingent liabilities [the basic idea]. 7. What is provisions in accounting [a basic introduction]. 8. IAS 37 vs GAAP. 9. IAS 37 vs GAAP [on onerous contract and restructuring charge]. e-readings: 1. Provisions, contingent liabilities and contingent assets (ACCA note on IAS 37). 2. Contingent liability (CFI). 3. IAS 37 note with illustrative examples. 4. What are provisions in accounting. 5. Provision in accounting with examples. 6. FRC review of IAS 37 [pdf]. 7. Accounting for legal claims: IFRS 37 vs GAAP. 8. IAS 37 [restructuring] vs GAAP. Slides: 1. IAS 37.
9.    Dec 17 (Friday) Time: 19-22 (classroom) [Drop-in session; attendance will be taken]	·          Analysis and interpretation of financial statements	Alexander et al., 2014: 31 Video: 1. Interpretation of financial statements. 2. Statement of cash flows (IAS 7). 3a. Types of financial analysis. 3b. Financial analysis made easy. 4a. Ratio analysis. 4b. Profitability ratios: margin. 4c. EBIT and EBITDA explained. 4d. Gearing and interest cover [ACCA lecture]. 4e. Asset turnover and ROCE [ACCA lecture]. (Also watch return on assets and return on equity {Buffett on ROE}). 4f. Basic EPS introduction [ACCA lecture]. [Also watch IAS 33 earnings per share and how to calculate diluted EPS]. 4g. Liquidity and working capital [ACCA lecture]. 5h. Interest coverage ratio. 4i. Limitation of ratio analysis. Slides: 1. on financial statement analysis.
10.          Dec 18 (Sat) Time: 14-20 (classroom) [Drop-in session; attendance will be taken]	·          Financial instruments ·          Revision Revision: 1. An introduction to the Harvard referencing system. A blog article on assignment essay structure	Alexander et al., 2014: 18 Videos: 1a. What are financial instruments (re: IFRS 9). [What is a financial instrument: the basic idea; also on financial instruments - stock market basics]. 1b. **** IFRS 9 - financial instruments (ACCA). (also watch **** IFRS 9 an introduction and background; also on a briefing on IFRS 9 financial assets classification). 2. IFRS - financial instruments, 2021 summary (also watch explaining IFRS 9 - a briefing). 3a. How is classification done on financial assets (also watch Classification and measurement of financial assets (IFRS9). 3b. IFRS classification criteria: a briefing. 3c. IFRS 9 classification: a briefing. 3d. IFRS 9 - cash flow characteristics test (SPPI vs non SPPI). 3e. **** IFRS 9 - debt instrument business model [ACCA lecture] (also watch **** IFRS 9: portfolios-business model test. 4a. IFRS 9 on convertible debentures (ACCA lecture). 4b. What are derivatives? futures? (also watch IFRS 9 : derivatives - a simple explanation) and then IFRS 9 derivatives [ACCA lecture]). 4c. Derivatives: forward and futures contracts (also watch IFRS 9 forward currency contracts [ACCA lecture]). 4d. Future contracts compared to forward contracts. 5. Amortized cost concept and calculation: an illustration on its calculation. 6. Impairment of financial assets (ACCA lecture). 7. Hedging - introduction [ACCA], then study Cash flow hedge accounting (ACCA lecture). 8. General and macro hedge accounting under IFRS 9. 9. Other IFRS 9 implementation issues. 10. Demystifying IFRS 9 for corporates - 1. 11. A revision of IAS 36 - impairment of assets. 12. IFRS 7 - financial instruments disclosure: a summary. (another one on IFRS 7 [cima]). e-readings: 1. ACCA note on financial instruments (IFRS 9). 2. Deloitte: IFRS 9: a high level summary (pdf). 3. Classification of financial assets and liabilities (IFRS 9). 4. Financial instrument note with examples for illustration. Slides: 1. on IFRS 9.

 

Core reading:

Alexander, D. & Britton A. & Jorissen A. (2014): International Financial Reporting and Analysis, 6th ed., Cengage.

e-resource: e-resource folder.