Question 1

How do you classify and measure a hybrid financial instrument with embedded derivatives?

Accepted Answer

Hybrid financial instruments with embedded derivatives are classified based on their underlying characteristics, typically following IFRS or GAAP guidelines. The host contract is measured at amortized cost or fair value, while the embedded derivative is assessed separately, often requiring fair value measurement. This classification ensures accurate financial reporting and risk assessment.

Question 2

How do you determine when to separate an embedded derivative from its host contract?

Accepted Answer

An embedded derivative is separated from its host contract if the economic characteristics and risks of the embedded derivative are not closely related to those of the host contract. Additionally, the entire instrument must be measured at fair value, and the derivative must meet the definition of a derivative under relevant accounting standards.

Question 3

Explain the expected credit loss (ECL) model and how it applies to trade receivables.

Accepted Answer

The expected credit loss (ECL) model is a forward-looking approach used to estimate potential losses from financial assets, including trade receivables. Under IFRS 9, companies must recognize ECLs based on historical data, current conditions, and forecasted economic trends. This model enhances transparency by requiring businesses to account for anticipated losses, thereby influencing credit risk management and financial reporting.

Question 4

How does fair value through OCI (FVTOCI) differ for equity versus debt instruments?

Accepted Answer

Fair value through OCI (FVTOCI) for equity instruments allows unrealized gains and losses to be recorded in other comprehensive income, while for debt instruments, it can be either at amortized cost or fair value, with changes in fair value recognized in profit or loss unless designated as FVTOCI.

Question 5

When is hedge accounting permitted, and what documentation is required to qualify?

Accepted Answer

Hedge accounting is permitted when the hedging instrument is highly effective in offsetting changes in the fair value or cash flows of the hedged item. Documentation required includes a formal designation of the hedging relationship, risk management objectives, and an assessment of effectiveness both at inception and on an ongoing basis.

Question 6

How would you account for a cash flow hedge that becomes ineffective?

Accepted Answer

If a cash flow hedge becomes ineffective, I would recognize the ineffectiveness in earnings immediately. According to accounting standards, the amount of the ineffective portion should be recorded in profit or loss, while the effective portion continues to be deferred in other comprehensive income until the forecasted transaction occurs.

Question 7

What special disclosures are required for Level 3 fair value measurements?

Accepted Answer

For Level 3 fair value measurements, disclosures must include the valuation techniques and inputs used, a description of the sensitivity of the measurements to changes in unobservable inputs, and any significant assumptions made during the valuation process.

Question 8

How do you account for loan modifications that change cash flows but are not extinguishments?

Accepted Answer

In cases of loan modifications that change cash flows but do not qualify as extinguishments, the effective interest rate method is applied. The modified cash flows are discounted using the original effective interest rate, and the difference is accounted for as a gain or loss in the period of modification, ensuring transparency in financial reporting.

Question 9

How do you apply the principal‑versus‑agent assessment in revenue and SPAs?

Accepted Answer

In applying the principal-versus-agent assessment, I evaluate who has control over the goods or services before they are transferred to the customer. If the entity is the principal, it recognizes revenue based on the gross amount; if an agent, it recognizes revenue based on the net amount earned for facilitating the transaction.

Question 10

How do you recognize the fair value of non-cash consideration in a contract?

Accepted Answer

The fair value of non-cash consideration is recognized based on the estimated amount for which the asset could be exchanged between knowledgeable, willing parties. This often involves using valuation techniques such as market, income, or cost approaches, considering the specific terms of the contract and assumptions of market participants.

Question 11

How would you treat credit risk in measuring the fair value of a liability?

Accepted Answer

In measuring the fair value of a liability, I would adjust the cash flows for credit risk by incorporating the entity's credit spread. This involves assessing the likelihood of default and the potential loss in the event of default, which can be reflected in the discount rate used in the valuation.

Question 12

How do you reclassify financial assets between categories when business model changes?

Accepted Answer

Reclassification of financial assets under IFRS 9 occurs when a business model change takes place. The criteria for reclassification depend on the new business model, and all affected assets must be remeasured at fair value at the date of reclassification. This can impact the financial statements significantly, especially in terms of how gains and losses are recognized.

Question 13

What adjustments are required if an entity repurchases its own debt in market?

Accepted Answer

When an entity repurchases its own debt in the market, it must adjust its financial statements to reflect the repurchase price compared to the carrying amount of the debt. Any difference results in a gain or loss, which is recognized in the income statement, thus affecting both the equity and liabilities on the balance sheet.

Question 14

How do you present the unwind of the discount on a financial liability measured at amortized cost?

Accepted Answer

The unwind of the discount on a financial liability measured at amortized cost is presented as an interest expense in the income statement. This reflects the effective interest method, where the carrying amount of the liability increases over time until it reaches the face value at maturity.

Question 15

What disclosures are needed for concentration of credit risk in financial instruments?

Accepted Answer

Disclosures for concentration of credit risk typically include identifying significant concentrations, the nature of the risk involved, and the potential impact on the financial position. Companies must also disclose any measures taken to mitigate these risks.

Question 16

How do you distinguish between operating and financing components of a hybrid instrument?

Accepted Answer

To distinguish between operating and financing components of a hybrid instrument, one must analyze the terms of the instrument. The operating component typically relates to the entity's core business operations, while the financing component pertains to the capital structure and may involve debt-like features. Proper classification is crucial for accurate financial reporting and compliance with accounting standards.

Question 17

When should a financial guarantee be recognized in the balance sheet?

Accepted Answer

A financial guarantee should be recognized in the balance sheet when it is probable that the issuer will be required to make a payment to settle the obligation and the amount can be reliably measured.

Question 18

How do you ensure transparency in presentation of unrealized losses from trading instruments?

Accepted Answer

To ensure transparency, I adhere to relevant accounting standards such as IFRS or GAAP, providing clear disclosures in financial statements. I also ensure that unrealized losses are presented separately from realized losses, and I communicate these updates regularly to stakeholders to maintain trust and clarity.

Question 19

Describe the accounting and presentation when a financial asset is defaulted and written off.

Accepted Answer

When a financial asset is defaulted and written off, it should be removed from the balance sheet, and any loss should be recognized in the profit and loss statement. The accounting treatment should comply with relevant standards such as IFRS 9, which requires an assessment of expected credit losses prior to write-off.

Question 20

How do you account for margins or collateral in derivative instruments?

Accepted Answer

In accounting for margins or collateral in derivative instruments, I ensure to recognize the collateral as an asset on the balance sheet if it meets the definition of an asset. I also account for any margin calls, adjusting the fair value of the derivative and ensuring that changes in fair value are reflected in the income statement as appropriate.

Question 21

How do you identify the acquirer in a reverse takeover situation?

Accepted Answer

In a reverse takeover, I identify the acquirer by evaluating the transaction structure to determine which entity gains control. I analyze the shareholder control post-transaction and review financial disclosures for insights into the ownership dynamics. This helps clarify the acquirer's identity and intentions.

Question 22

What approach is used to measure goodwill if the acquisition agreement includes a purchase price adjustment clause?

Accepted Answer

In such cases, goodwill is measured by assessing the fair value of the acquired assets and liabilities at the acquisition date, factoring in any contingent considerations stipulated in the purchase price adjustment clause, which may affect the final recorded goodwill on the balance sheet.

Question 23

How do you measure contingent consideration for business combination at acquisition date?

Accepted Answer

Contingent consideration is measured at fair value at the acquisition date, taking into account the probability-weighted outcomes of future performance expectations. This amount is recognized in the financial statements as part of the purchase price and adjusted in subsequent periods based on changes in fair value.

Question 24

When do you reassess the classification of deferred consideration as a liability or equity instrument?

Accepted Answer

Reassessment of deferred consideration classification occurs when there are changes in the contractual terms or the settlement options, indicating a shift in the nature of the obligation from liability to equity or vice versa.

Question 25

How should an earn‑out arrangement be accounted for post‑acquisition?

Accepted Answer

An earn-out arrangement should be recognized as a contingent liability at fair value at the acquisition date. Subsequent changes in fair value are recorded in profit or loss, affecting goodwill. It's crucial to disclose the terms and conditions of the earn-out in the financial statements.

Question 26

How is goodwill tested when a CGU includes multiple assets with different recoverable amounts?

Accepted Answer

Goodwill is tested for impairment at the CGU level, where it is allocated. If the CGU includes multiple assets with different recoverable amounts, the recoverable amount of the CGU as a whole is compared to its carrying amount, and any impairment is allocated to the assets within the CGU based on their carrying amounts.

Question 27

How are impairment losses allocated among the assets in a unit with goodwill?

Accepted Answer

Impairment losses are allocated first to reduce the carrying amount of goodwill, and then to the other assets in the unit on a pro-rata basis based on their carrying amounts. This ensures that the impairment reflects the true economic value of the assets.

Question 28

Under what conditions can an impairment loss on goodwill be reversed?

Accepted Answer

An impairment loss on goodwill cannot be reversed under current accounting standards, such as IFRS and GAAP. Once goodwill is impaired, it remains at the reduced value, reflecting the permanent nature of the impairment.

Question 29

How do you determine the appropriate discount rate for value‑in‑use calculations?

Accepted Answer

The appropriate discount rate for value-in-use calculations is typically determined using the weighted average cost of capital (WACC), reflecting the risk profile of the cash flows. It should account for the specific risks associated with the asset and the industry in which it operates.

Question 30

What disclosures are needed for goodwill that is not impaired, when material?

Accepted Answer

For goodwill that is not impaired and is material, disclosures should include the carrying amount of goodwill, the basis for its valuation, and any assumptions used in impairment testing. Additionally, if there are significant changes in the underlying factors that could affect goodwill, these should also be disclosed to provide clarity to stakeholders.

Question 31

How do you treat acquisition‑related restructuring costs under Ind AS?

Accepted Answer

Under Ind AS, acquisition-related restructuring costs should be recognized as expenses in the period they are incurred, provided they meet recognition criteria. These costs are typically classified as operating expenses, impacting the income statement and reflecting the company's ongoing restructuring efforts post-acquisition.

Question 32

How do you account for pre‑combinations relating to business combination accounting?

Accepted Answer

In accounting for pre-combinations, I follow IFRS 3 guidelines, which require recognizing assets and liabilities acquired in a business combination at their fair values. Pre-combination transactions are accounted for by assessing their impact on the purchase price allocation and ensuring that they do not distort the financial position post-acquisition.

Question 33

What judgements are involved in identifying intangible assets in a business combination?

Accepted Answer

Identifying intangible assets in a business combination involves judgments regarding the recognition of assets such as trademarks, patents, and customer relationships. Valuation methods, including income and market approaches, are used to assess their fair value, and the determination of their useful life requires careful consideration of factors like market conditions and expected economic benefits.

Question 34

How do you reflect gain on bargain purchase in the period of acquisition?

Accepted Answer

A gain on a bargain purchase is recognized in the period of acquisition as the excess of the fair value of net assets acquired over the purchase price. This gain should be recorded in the income statement as a separate line item, ensuring that the financial statements accurately reflect the benefit derived from the acquisition.

Question 35

How are non-controlling interests measured and presented in consolidated financials?

Accepted Answer

Non-controlling interests are measured at fair value on the acquisition date, and subsequently, they are presented in the equity section of the consolidated balance sheet, separate from the parent company's equity.

Question 36

When might push‑down accounting be appropriate or required for a business combination?

Accepted Answer

Push-down accounting is appropriate when the acquired entity becomes a wholly owned subsidiary, allowing the acquirer to reflect the fair value of the acquired assets and liabilities in the subsidiary's financial statements.

Question 37

How do you re-present comparatives when business combination occurred mid-year?

Accepted Answer

When a business combination occurs mid-year, comparatives should be re-presented by consolidating the acquired entity's results from the acquisition date forward. This ensures that the financial statements reflect the combined entity's performance consistently, adhering to relevant accounting standards such as IFRS 3.

Question 38

What are the implications if part of purchase consideration is deferred and contingent on performance?

Accepted Answer

Deferring part of the purchase consideration linked to performance introduces a contingent liability, which must be assessed for recognition in financial statements. This can affect cash flow projections and require disclosures regarding the potential impact on future earnings, as the seller may not realize the full amount until the performance criteria are met.

Question 39

How do you reflect changes in fair value business combination adjustments in consolidated financials?

Accepted Answer

Changes in fair value business combination adjustments are reflected in consolidated financials by adjusting the carrying amounts of the identifiable assets and liabilities of the acquired entity, with any excess recognized as goodwill. These adjustments are incorporated into the consolidated balance sheet and impact the income statement through depreciation or amortization of the adjusted assets.

Question 40

How do you account for step‑acquisitions and re‑measurements of existing interests?

Accepted Answer

In accounting for step-acquisitions, I would apply fair value measurement to the acquired interest at the acquisition date, use proportional consolidation for the previously held interest, and ensure compliance with GAAP or IFRS standards throughout the process.

Question 41

When is performance obligation satisfaction over time versus at point in time appropriate?

Accepted Answer

Performance obligation satisfaction over time is appropriate when the contract involves continuous transfer of control, such as in construction, while point in time recognition is suitable when control transfers at a specific moment, typically upon delivery of goods or completion of a service.

Question 42

How do you account for sale with repurchase agreement?

Accepted Answer

In accounting for a sale with a repurchase agreement, it is essential to determine whether the transaction qualifies as a true sale or a secured borrowing. If treated as a sale, revenue can be recognized, but the obligation to repurchase must be recorded as a liability. This affects cash flow statements, as the proceeds from the sale are recognized while the repurchase liability may impact future cash outflows.

Question 43

How do you estimate variable consideration in a long‑term construction contract?

Accepted Answer

To estimate variable consideration in a long-term construction contract, I would first identify the potential variables such as performance bonuses or penalties. Then, I would apply the principles of ASC 606 to determine whether these amounts are probable and can be reliably estimated, using either the expected value or the most likely amount approach to quantify the variable consideration.

Question 44

How should rights of return be included in revenue measurement and disclosures?

Accepted Answer

Rights of return should be included in revenue measurement by estimating the expected returns at the time of sale. This involves analyzing historical return data to adjust the recognized revenue and create a corresponding liability for expected returns. Disclosures should also clearly indicate the nature of return rights and the impact on revenue, ensuring compliance with applicable accounting standards.

Question 45

How do you handle a customer’s option to purchase additional goods at a discount?

Accepted Answer

I would first ensure I understand the customer's needs and the value they see in the additional goods. Then, I would communicate the benefits of the discount clearly, ensuring that they feel valued, and negotiate terms that are favorable for both parties.

Question 46

From a contract perspective, when would a non‑refundable upfront fee be recognized over time?

Accepted Answer

A non-refundable upfront fee is recognized over time when it relates to the transfer of goods or services that are provided continuously over the contract term, aligning with the performance obligations outlined in ASC 606.

Question 47

How are combined goods/services packaged into performance obligations?

Accepted Answer

Combined goods or services are packaged into performance obligations by identifying distinct performance obligations based on the criteria set in accounting standards such as ASC 606. This involves assessing whether the goods/services are capable of being distinct and whether they are separately identifiable in the contract. The transaction price is then allocated to these obligations based on their relative standalone selling prices.

Question 48

How do you deal with bill‑and‑hold arrangements and identify delivery versus control transfer?

Accepted Answer

In bill-and-hold arrangements, I ensure that the criteria set by ASC 606 are met, which include the buyer requesting the arrangement, the goods being fully manufactured, and the seller retaining the risks and rewards. Control transfer is identified when the buyer takes on the risks associated with the goods, even if physical delivery hasn't occurred, allowing for revenue recognition at that point.

Question 49

How do you account for licenses—distinct or a right to use?

Accepted Answer

Licenses can be accounted for as either distinct or a right to use, depending on the terms of the agreement. A distinct license is treated as a separate performance obligation, while a right to use license is recognized over the period the customer has access to the asset. This affects how revenue is recognized and reported in financial statements.

Question 50

How do you recognize revenue for loyalty programs or customer credits?

Accepted Answer

Revenue for loyalty programs or customer credits is recognized based on the proportion of points redeemed compared to total points issued. According to ASC 606, companies must allocate a portion of the transaction price to the loyalty points, treating them as a separate performance obligation. This deferred revenue is then recognized when the customer redeems the points, ensuring accurate reflection of revenue in financial statements.

Question 51

How do you handle changes in transaction price estimates in contracts over time?

Accepted Answer

I closely monitor contract terms and maintain open communication with stakeholders. When changes in transaction price estimates occur, I assess the impact on profitability and cash flow, adjusting forecasts accordingly to ensure transparency and alignment with project goals.

Question 52

When do contract modifications trigger separate or combined accounting?

Accepted Answer

Contract modifications trigger separate accounting when they create a new distinct good or service, meeting the criteria outlined in ASC 606. If the modification does not result in a distinct good or service, it is combined with the existing contract, and the revenue is recognized according to the original terms, adjusted for any changes in the transaction price.

Question 53

How do you treat performance bonuses that depend on future sales thresholds?

Accepted Answer

Performance bonuses tied to future sales thresholds should be recognized as a liability when the sales are probable and can be reasonably estimated. This ensures that expenses are matched with the revenues they help generate, adhering to the accrual basis of accounting.

Question 54

How would you account for insurance and service contracts performed together?

Accepted Answer

For insurance and service contracts performed together, I would identify the distinct performance obligations within the contract, allocate the transaction price based on standalone selling prices, and recognize revenue as each obligation is satisfied, in accordance with IFRS 15 or ASC 606.

Question 55

How do you report financing components affecting the transaction price?

Accepted Answer

Financing components affecting the transaction price are reported by recognizing the time value of money in the transaction. This involves discounting future cash flows to their present value and adjusting the transaction price accordingly to reflect the financing terms. Compliance with applicable accounting standards, such as IFRS 15 or ASC 606, is essential to ensure accurate reporting.

Question 56

What judgments determine which method (input vs output) to use for measuring progress?

Accepted Answer

The choice between input and output methods for measuring progress depends on the nature of the project and the availability of reliable data. Input methods are typically used when costs incurred are reliable indicators of progress, while output methods are preferred when measurable outputs are readily available, aligning with revenue recognition principles under IFRS 15 or ASC 606.

Question 57

How should you present revenue where entity is an agent for commission-only transactions?

Accepted Answer

In an agent relationship for commission-only transactions, revenue should be presented net of the costs associated with the transaction. This aligns with the revenue recognition criteria under IFRS 15, where the agent recognizes revenue based on the commission earned rather than the total transaction value.

Question 58

How are contract asset/contract liability balances presented and disclosed?

Accepted Answer

Contract assets and liabilities are presented on the balance sheet under current assets and current liabilities, respectively. Disclosure should include the nature of the contracts, significant judgments made, and how these balances impact revenue recognition in accordance with applicable accounting standards.

Question 59

How are costs to obtain/fulfill a contract (e.g., commissions) treated for capitalization?

Accepted Answer

Costs to obtain or fulfill a contract, such as commissions, can be capitalized if they are directly attributable to the contract and expected to be recovered. They should be amortized over the contract duration, aligning the expense recognition with revenue recognition.

Question 60

How do you account when contract terms change the scope and price mid‑performance?

Accepted Answer

When contract terms change mid-performance, the modification must be assessed to determine if it creates a separate contract or modifies the existing one. Under IFRS 15, if the modification changes the scope or price, it is treated as a separate contract if it adds distinct goods or services. Otherwise, the existing contract's revenue recognition may need to be adjusted based on the new terms, reflecting any changes in the transaction price and performance obligations.

Question 61

How do you determine lease term when extension options are not reasonably certain to be exercised?

Accepted Answer

When extension options are not reasonably certain to be exercised, I determine the lease term based on the contractual terms and the economic factors influencing the entity's decision. I also apply professional judgment and estimates, considering the likelihood of renewal based on historical usage and market conditions.

Question 62

How do you separate lease and non‑lease components in a contract?

Accepted Answer

To separate lease and non-lease components in a contract, I would first identify the distinct components that provide separate benefits to the lessee. According to IFRS 16, I would assess whether the non-lease components, such as maintenance or service fees, are distinct and can be accounted for separately. If they are, I would allocate the total consideration based on their relative standalone prices, ensuring accurate financial reporting.

Question 63

How is the ROU asset re‑measured for lease modifications?

Accepted Answer

The ROU asset is re-measured for lease modifications by adjusting the asset's carrying amount to reflect the revised lease payments, using the updated discount rate that corresponds to the modified terms. This includes any changes in the lease term or scope, ensuring the financial statements accurately reflect the new lease arrangement.

Question 64

How are variable lease payments linked to indices treated?

Accepted Answer

Variable lease payments linked to indices are recognized as an expense in the period in which they are incurred. Under IFRS 16, they are not included in the initial measurement of the lease liability but are accounted for as they arise based on the changes in the index.

Advanced Financial Reporting – Interview Q&A

A. Financial Instruments & Fair Value

Q1: How do you classify and measure a hybrid financial instrument with embedded derivatives?

Q2: How do you determine when to separate an embedded derivative from its host contract?

Q3: Explain the expected credit loss (ECL) model and how it applies to trade receivables.

Q4: How does fair value through OCI (FVTOCI) differ for equity versus debt instruments?

Q5: When is hedge accounting permitted, and what documentation is required to qualify?

Q6: How would you account for a cash flow hedge that becomes ineffective?

Q7: What special disclosures are required for Level 3 fair value measurements?

Q8: How do you account for loan modifications that change cash flows but are not extinguishments?

Q9: How do you apply the principal‑versus‑agent assessment in revenue and SPAs?

Q10: How do you recognize the fair value of non-cash consideration in a contract?

Q11: How would you treat credit risk in measuring the fair value of a liability?

Q12: How do you reclassify financial assets between categories when business model changes?

Q13: What adjustments are required if an entity repurchases its own debt in market?

Q14: How do you present the unwind of the discount on a financial liability measured at amortized cost?

Q15: What disclosures are needed for concentration of credit risk in financial instruments?

Q16: How do you distinguish between operating and financing components of a hybrid instrument?

Q17: When should a financial guarantee be recognized in the balance sheet?

Q18: How do you ensure transparency in presentation of unrealized losses from trading instruments?

Q19: Describe the accounting and presentation when a financial asset is defaulted and written off.

Q20: How do you account for margins or collateral in derivative instruments?

B. Business Combinations, Goodwill & Impairment

Q21: How do you identify the acquirer in a reverse takeover situation?

Q22: What approach is used to measure goodwill if the acquisition agreement includes a purchase price adjustment clause?

Q23: How do you measure contingent consideration for business combination at acquisition date?

Q24: When do you reassess the classification of deferred consideration as a liability or equity instrument?

Q25: How should an earn‑out arrangement be accounted for post‑acquisition?

Q26: How is goodwill tested when a CGU includes multiple assets with different recoverable amounts?

Q27: How are impairment losses allocated among the assets in a unit with goodwill?

Q28: Under what conditions can an impairment loss on goodwill be reversed?

Q29: How do you determine the appropriate discount rate for value‑in‑use calculations?

Q30: What disclosures are needed for goodwill that is not impaired, when material?

Q31: How do you treat acquisition‑related restructuring costs under Ind AS?

Q32: How do you account for pre‑combinations relating to business combination accounting?

Q33: What judgements are involved in identifying intangible assets in a business combination?

Q34: How do you reflect gain on bargain purchase in the period of acquisition?

Q35: How are non-controlling interests measured and presented in consolidated financials?

Q36: When might push‑down accounting be appropriate or required for a business combination?

Q37: How do you re-present comparatives when business combination occurred mid-year?

Q38: What are the implications if part of purchase consideration is deferred and contingent on performance?

Q39: How do you reflect changes in fair value business combination adjustments in consolidated financials?

Q40: How do you account for step‑acquisitions and re‑measurements of existing interests?

C. Revenue Recognition & Contractual Arrangements

Q41: When is performance obligation satisfaction over time versus at point in time appropriate?

Q42: How do you account for sale with repurchase agreement?

Q43: How do you estimate variable consideration in a long‑term construction contract?

Q44: How should rights of return be included in revenue measurement and disclosures?

Q45: How do you handle a customer’s option to purchase additional goods at a discount?

Q46: From a contract perspective, when would a non‑refundable upfront fee be recognized over time?

Q47: How are combined goods/services packaged into performance obligations?

Q48: How do you deal with bill‑and‑hold arrangements and identify delivery versus control transfer?

Q49: How do you account for licenses—distinct or a right to use?

Q50: How do you recognize revenue for loyalty programs or customer credits?

Q51: How do you handle changes in transaction price estimates in contracts over time?

Q52: When do contract modifications trigger separate or combined accounting?

Q53: How do you treat performance bonuses that depend on future sales thresholds?

Q54: How would you account for insurance and service contracts performed together?

Q55: How do you report financing components affecting the transaction price?

Q56: What judgments determine which method (input vs output) to use for measuring progress?

Q57: How should you present revenue where entity is an agent for commission-only transactions?

Q58: How are contract asset/contract liability balances presented and disclosed?

Q59: How are costs to obtain/fulfill a contract (e.g., commissions) treated for capitalization?

Q60: How do you account when contract terms change the scope and price mid‑performance?

D. Leases & Investment Property

Q61: How do you determine lease term when extension options are not reasonably certain to be exercised?

Q62: How do you separate lease and non‑lease components in a contract?

Q63: How is the ROU asset re‑measured for lease modifications?

Q64: How are variable lease payments linked to indices treated?

Q65: How do you account for a sale and leaseback transaction at below‐market rates?

Q66: For sub-leasing, how do you assess classification as finance or operating sub-lease?

Q67: How are lease incentives amortized in financial statements?

Q68: How are lease receivables presented from lessors under a finance lease?

Q69: How do you reflect impairment on ROU assets or right to use when indicators exist?

Q70: What disclosure is required on maturity analysis of lease liabilities?

Q71: How is rent-free period expense recognized in ROU accounting?

Q72: How are initial direct costs treated by lessors vs lessees?

Q73: How is a change in the assessment of whether a contract contains a lease handled?

Q74: How are short-term lease exemption policies applied consistently across subsidiaries?

Q75: What are the disclosures regarding variable lease payments and lease term judgements?