Disclosure versus Recognition Recognition means to record the event or

Disclosure versus recognition recognition means to

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Disclosure versus Recognition Recognition means to record the event or transaction in the body of the financial statements. Disclosure means to provide information about the event or transaction outside the body of the financial statements, e.g, in the Notes to the financial statements. It is common to disclose events that meet the definitions but fail the recognition criteria. 55
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Measurement “Elements recognised in financial statements are quantified in monetary terms. This requires the selection of a measurement basis. A measurement basis is an identified feature for example, historical cost, fair value or fulfilment value of an item being measured .” (CF 6.1) Two categories of measurement basis, Historical Cost: The initial value of the costs incurred in acquiring or creating the asset Current Value: Reflects conditions at measurement date. It includes Fair value: Price to be received to sell an asset or paid to transfer a liability. Value in use (asset)/fulfilment value (liabilities): PV of future cash flows or other economic benefits Current cost: Cost of an equivalent asset/consideration that would be received for an equivalent liability at measurement date. 56
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  • Balance Sheet, International Financial Reporting Standards, Research School of Accounting

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