The Handbook to IFRS Transition and to IFRS U.S. GAAP Dual Reporting

KEY ELEMENTS AND DECISIONS

Paragraph 5.2.1

Even when accounting pronouncements permit alternative terminology, opt for titles of financial statements that clearly identify GAAP used.

Paragraph 5.2.2

Make sure that the location of the statement of cash flows places such a statement as an integral part of basic financial statements.

Paragraph 5.2.3

Consider that IAS 7, unlike U.S. GAAP, does not exempt any entity from the presentation of the statement of cash flows.

Paragraph 5.3.1

Review the minimum line items for cash and cash equivalents in the statement of financial position, also taking into consideration the guidance applicable to specific industries;

Check the correspondence and reconciliation of amounts and titles of cash and cash equivalents with the statement of cash flows.

Paragraph 5.4.1

Decide whether to adopt the direct method or the indirect method of reporting cash flows from operating activities.

Paragraph 5.4.2

Structure the chart of accounts or statistical codes to facilitate data gathering for the statement of cash flows. For example, segregate revenue, expenses, respective receivables, and payables for sale of goods versus those related to rendering of services. Track payables relating to long-lived assets separately from operating payables and identify their cash settlement with respective dates;

Consider building forecasting procedures according to the direct method for cash flow planning and budgeting. This entails gathering data ...