Comparison of Aspe for Ifrs

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Accounting Standards in Transition | A Comparison of IFRS and ASPE in Canada | | | | TABLE OF CONTENTS Executive Summary III Part I Key Differences between IFRS and ASPE 1 I. Frameworks for Financial Reporting 1 II. Form and Components of the Required Financial Statements 1 III. Revenues and Expenses Recognition 2 IV. Errors, Changes in Estimates, and Changes in Accounting Policies 2 V. Cash and Receivables 3 VI. Inventories 3 VII. Financial Assets 3 VIII. Property, Plant, and Equipment 4 IX. Intangible Assets, Goodwill, Mineral Resources, and Agriculture 4 X. Applications of Fair Value: Revaluations, Impairments, and Non-current Assets Held for Sale 4 XI. Current Liabilities 5 XII. Contingencies…show more content…
In summary, IFRS is more restrictive of assets than ASPE and more encompassing of liabilities than ASPE. It results in the equity section under IFRS being reported more conservatively than under ASPE (CICA, 2011, Section 1000). III. Revenues and Expenses Recognition The key difference of revenues and expenses recognition is obvious. According to IFRS, the income statement records the increasing of future economic benefit as revenues, such as sales, interests, dividends, and rents, and the recognition of revenues and expenses are combined directly in the same transaction (Matching principle). But ASPE standards state that the income statement only records the existing or realizing performance as revenues. Same situation in the expenses, in IFRS’s income statement, they are recognized by a decrease in the asset or an increase in the liability for future position. In addition, under ASPE, we do not recognize an expense as a provision unless the benefit does qualifies as an asset (CICA, 2011, Section 1000). IV. Errors, Changes in Estimates, and Changes in Accounting Policies Under IFRS, a full retrospective restatement is required to correct the prior period error, unless it is impracticable to determine the period-specific effects. For ASPE, a private enterprise is allowed to make the correction on the error on each specific prior period. Under IFRS, the recognition of changes in accounting estimates affects the future period. If the

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