Analyzing IFRS Financial Statements - What's the Difference?

Mike Morley

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The adoption of IFRS is resulting in some significant changes when it comes to analyzing financial statements. For example, how do you compare the old GAAP statements with the new IFRS statements? Do the new asset valuation methods affect the asset values that are recorded at historical cost on the balance sheet? How do changes in asset value affect the balance sheet? Do they affect the amount of depreciation being recognized on the income statement? What about changes in value year to year? These are all important considerations when lenders and investors are making economic decisions whether to lend to or invest in a company. 

What about volatility in the valuation of significant assets? How does it affect bank financing and collateralization? Lending institutions base their loan to asset ratios on depreciated asset amounts that are rely on stable historical costs. Will lines of credit vary according the changing values of assets that are the basis for issuing loans? Does the volatility change the amount of perceived risk? 

If a business combination occurs, how are assets transferred? At historical cost? At depreciated cost? At current market value? Are there assets that do not get transferred from a GAAP statement to a new IFRS statement as a result of the business combination? Are there some assets that are not recognized on the balance sheet Are there some new assets that added onto the IFRS balance sheet that were not on the GAAP balance sheet? If Goodwill is a result of a business combination from a GAAP accounting environment to an IFRS environment, how is it evaluated and recorded? What are the rules going forward for reevaluating the impairment of Goodwill on a year-to-year basis? 

How does the change from GAAP to IFRS modify the requirements for the Notes to the financial statements? Are more details explaining the effects of the change needed? If yes, what format should be used? To what extent is both subjective and quantitative information used in the Notes? 

This presentation answers these questions and many others by dissecting IFRS financial statements and comparing them to GAAP based statements using numbers from examples that come from every-day life.

Course Objective

Not only will you be able to recognize the significant differences between IFRS financial statements and GAAP financial statements, but you will learn a consistent method of comparing successfully with the two methods of accounting. Although the focus will be on the two main differences which are asset valuation and revenue recognition rules, the Cash Flow statement will also be examined in detail to provide a super quick way of assessing a company’s ability to survive, pay its bills, and even grow. You will be able to look at GAAP and IFRS financial statements to facilitate making economic decisions such as investing and lending. In addition, by looking at practical examples that highlight the fundamental differences introduced by IFRS, you will learn my unique approach to assessing a company’s cash flow and its subsequent ability to pay its bills. This session will show you the techniques that I use to analyze IFRS financial statements quickly and easily.

Course Outline

  • Old GAAP vs. IFRS
  • The four key principles of IFRS
  • A new valuation model - is Historical Cost gone completely?
  • How revenue has changed under IFRS - how crucial can it be?
  • Follow the money - deciphering the Cash Flow Statement
  • Using financial statement notes  to "decode" the numbers

Target Audience

  • Board Members
  • External Auditors
  • Compliance Professionals
  • Operational professionals
  • Finance Professionals
  • Internal auditors

Webinar Events
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Training CD-DVD

Physical CD-DVD of recorded session will be despatched after 72 hrs on completion of payment

Recorded video

Recorded video session

Speaker: Mike Morley,

A Certified Public Accountant, business author Mike Morley is an entertaining and informative speaker and a recognized authority in the field of finance. Mike offers various training programs, such as IFRS, SOX, and Financial Statement Analysis that focus on providing continuing education opportunities for finance and accounting professionals. Many Fortune 500 companies take advantage of his training programs to bring their staff up to speed so that everyone understands what their responsibilities are. Mike is the author of several books, including: “IFRS Simplified” which provides a jump start for accountants and finance executives who want to quickly and easily get up to date on IFRS. “Sarbanes-Oxley Simplified” which is an easy-to-read explanation of the requirements of the U.S. legislation that makes CEO's & CFO's personally responsible for the accuracy of their company's financial statements. “Financial Statement Analysis Simplified” which translates the accounting language of financial statements into clear, easy-to-understand terms that anyone who needs to make well-informed financial decisions quickly will appreciate

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