Arbeitskreis Group Accounting 2016

4th AKKoRe

"From standard to implementation"

The Group Accounting working group has now firmly established itself. It is aimed at the heads of group accounting. On the 12th of May 2016, he will be playing for the fourth time at the Frankfurt a.M. at THE SQUAIRE. Topics include integrated reporting, IFRS 9, IFRS 15, IFRS 16 and Integrated Reporting. The joint work identifies the effects of new standards on processes and structures, derives the necessary measures vertically down to the individual company and uncovers the typical pitfalls of such projects. In an open working atmosphere, everyone should be able to profit professionally and personally.

Focus topics:

IFRS 16 - Leases
The new lease standard was released on January 13, 2016. So it becomes serious with the extensive accountability of rights and obligations under rental and leasing contracts with the lessee. In the future, the right to use a leased asset and the corresponding lease liability will have to be accounted for. There are exceptions only for short-term contracts and low-value assets. For lessors, the distinction remains between finance and operating leases. The standard is mandatory for financial years beginning on or after 1.1.2019.

IFRS 15 - Revenue from Contracts with Customers
The new standard for revenue recognition was already published in May 2014 and has repeatedly been the subject of this working group. However, several studies show that many companies have not studied the effects in depth yet. And that, although the standard for some companies will have serious consequences for the process chain Contract - Performance - Service Entry - Revenue Recognition. In particular, business models involving complex performance promises made from products and services, as well as contracts involving variable, contingent or deferred consideration, are particularly affected by the changes.

IRFS 9 - Financial Instruments
This standard, in its full form, has also been on the market since mid-2014. In particular, the new regulations of IFRS 9 provide for a new classification model for financial assets. The subsequent assessment will then be based on three categories with different value scales and a different recording of changes in value. The new impairment model shifts the focus to a trend towards earlier loan loss provisions. Of these, lease receivables in accordance with IFRS 16 and contract assets in accordance with IFRS 15 are also particularly affected. The amended impairment rules also result in amended notes in accordance with IFRS 7. In contrast, the requirements in terms of recognition and initial valuation compared to the previous standard IAS 39 are essentially unchanged. By nature, the biggest changes are mainly for financial service providers. But non-banks should familiarize themselves with the new regulations.

Integrated Reporting
Integrated reporting is becoming increasingly important worldwide, especially after experiencing the financial crisis. Obviously, economic key figures alone are not enough to comprehensively map the true situation of companies. Therefore, the approaches are aimed at restoring lost public confidence by providing comprehensive information on all projects, risks and objectives of the companies.
Integrated Reporting is a holistic approach that brings together not only raw numbers but also information on environmental, intangible, societal or regulatory factors to enable a more comprehensive assessment of the situation. In 2012, the International Integrated Reporting Council presented the prototype for a corresponding integrated reporting framework concept.

An event of the competence network Group Accounting
The competence network has set itself the goal of anticipating best-practice approaches to new and well-known challenges in Group accounting. With our working group, we have also launched a platform where the experts in Group accounting can communicate at a high level and discuss the challenges in their respective companies. The members are the heads of group accounting, predominantly in large corporations. As a rule, the group consists of about 30 participants with increasing tendency, which are divided into specialist groups and very open and intensively discuss current topics. Requirements are discussed confidentially in small groups of like-minded people, solution options are worked out, risks are identified, and possible implementation programs are developed. The workshops will be moderated and documented by experienced experts.

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