IFRS for the Real Estate Sector (2 days)

Introduction

This two-day course examines international financial reporting issues and their effect on real estate entities. Our specialist instructors discuss the critical issues that go beyond mere number-crunching and explain, clearly and simply, the way the real estate sector conducts and shapes its accounting and reporting practices under existing and new IFRSs.

By reference to accepted accounting practices in the sector, delegates leave this course with practical knowledge of the wide spectrum of principle-based IFRSs that are applicable to the real estate sector. Participants will, for example, learn how to relate the standards on property, plant and equipment, leases, business combinations and investment property to leased or sold assets. The program also covers the treatment of investment projects, related borrowing costs and marketing, sales, development and construction expenditures, the appropriate basis for investment property valuation, and disclosure requirements and other issues that are unique to the real estate sector. The course will also deal with the requirements of the new standards on revenue (IFRS 15, effective for 2018) and Leases (IFRS 16, effective for 2019).

This valuable course answers questions such as:

• What are the accounting requirements for typical real estate lease, property, and investment property activities?
• How are lease contracts analyzed for accounting purposes?
  • What is required under IFRS 16 Leases when accounting by lessors and lessees?
  • How does the new standard, IFRS 15 Revenue from Contracts with Customers impact on real estate transactions?
• When are lease incentives, service costs and embedded derivatives recognized and how are they measured?
  • How does IFRS 9 Financial Instruments impact on mortgages, traded debt, and other financing instruments used in the real estate market?

Learning Objectives

• Understand the basic principles of IFRS
• Establish accounting policies where specific guidance does not exist
• Learn practical answers to typical real estate questions on leases, property, plant and equipment and investment property
• Be able to analyze lease contracts and accurately account for lease incentives, service costs and embedded derivatives
• Understand the new IFRS 15 model
• Understand the proposed lease standard form the lessor and lessee view
• Apply “best practices” and industry recommendations within the real estate sector

Who Should Attend

Preparers, auditors and analysis in the real estate sector who need to understand the application of IFRS.

Topics

• Overview and IFRS Conceptual Framework - General Principles and Standards
• IAS 1 Presentation of Financial Statements
• IAS 2 Inventories
• IAS 7 Statement of Cash Flows
• IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors
• IAS 10 Events after the Reporting Period
• IAS 11 Construction Contracts (compared to its replacement, IFRS 15)
• IAS 12 Income Taxes
• IFRS 8 Operating Segments
• IAS 16 Property, Plant and Equipment
  • Cost
  • Component approach
  • Depreciation method and period
  • Assets under-development
  • Cost model vs. revaluation model
• IAS 17 Leases and IFRS 16 Leases
  • Classification of leases
  • Treatment by the lessor
  • Lease incentives
  • Service costs
  • Contingent rents
  • Sale and lease-back arrangements
  • Derivatives embedded in lease agreements
• IAS 18 Revenue (compared to IFRS 15)
• IAS 20 Government Grants and Disclosure of Government Assistance
• IAS 23 Borrowing Costs
• IAS 24 Related Party Disclosures
• IAS 28 Investments in Associates and Joint Ventures
• IAS 34 Interim Financial Reporting
• IAS 36 Impairment of Assets
• IAS 37 Provisions, Contingent Liabilities and Contingent Assets
• IAS 38 Intangible Assets
• IAS 40 Investment Property
  • Definition of investment property
  • Initial measurement
  • Directly attributable expenditures
  • Cost model vs. revaluation model
  • Determination of fair value
  • Presentation of changes in fair value
• IFRS 1 First-time Adoption of International Financial Reporting Standards- Overview
• IFRS 2 Share-based Payment
• IFRS 3 Business Combinations
• IFRS 5 Non-current Assets Held for Sale and Discontinued Operations
• IFRS 7 Financial Instruments: Disclosures
• IFRS 9 Financial Instruments
• IFRS 10 Consolidated Financial Statements
• IFRS 11 Joint Arrangements
• IFRS 12 Disclosures of Interest in Other Entities
• IFRS 13 Fair Value Measurement
• Review of model IFRS Financial Statements
• Real-world IFRS Financial Statements

Teaching Method

• Group live instruction with interactive participation encouraged
• Identification of the critical issues affecting financial reporting in the real estate industry
• Real life examples of IFRS impacting real estate entities
• Presentation and discussion of recommended financial statement disclosures
• All participants receive a comprehensive binder containing copies of the presentation slides, handouts and other course materials

Instructors

Venue

CPE/CPD Accreditation

IASeminars is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org .

 

Field of study: Accounting

Prerequisites

Basic to intermediate understanding of accounting principles based on any national standards. No advance preparation is required for this course.