Tag Archives: covid 19 effects

COVID-19 EFFECT ON FINANCIAL STATEMENT

COVID-19 FINANCIAL STATEMENTS

Alert COVID-19 / Finance Executives and Auditors

Finance Executives and Auditors continue to evaluate the impact of COVID-19 Outbreak

Potential impact and implications on assets, liabilities and results – both present and future

Events after the reporting period

Fair value measurement and Assets impairment

Expected credit loss assessment

Risk assessment of the entity

Events after the reporting date: Should COVID-19 be accounted for as an adjusting or non-adjusting event?

Financial statements disclosure requirements

The magnitude of the disruptions by the outbreak to their business

The Management’s assumptions about the recoverability of an asset or settlement of a liability

The information about those assets and liabilities subject to significant estimates and uncertainty

The estimates and uncertainty would generally be of:

Variable consideration and other constraints on onerous contracts with customers and suppliers

NRV of inventories

Useful life and residual value of property, plant and equipment, intangible assets and right-of-use assets

Measurement of expected credit losses

Fair value measurement of assets and liabilities

Going concern assessment

Based on all of the above are adjusting/non-adjusting events