contingent asset – A possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. [IAS 37.10]
contingent consideration – Usually, an obligation of the acquirer to transfer additional assets or equity interests to the former owners of an acquiree as part of the exchange for control of the acquiree if specified future events occur or conditions are met. However, contingent consideration also may give the acquirer the right to the return of previously transferred consideration if specified conditions are met. [IFRS 3.A]
contingent liability – (a) A possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity; or (b) a present obligation that arises from past events but is not recognized because:
(i) it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or
(ii) the amount of the obligation cannot be measured with sufficient reliability.
contingent rent – That portion of the lease payments that is not fixed in amount but is based on the future amount of a factor that changes other than with the passage of time (eg percentage of future sales, amount of future use, future price indices, future market rates of interest). [IAS 17.4]
contingent share agreement – An agreement to issue shares that is dependent on the satisfaction of specified conditions. [IAS 33.5]
contingently issuable ordinary shares – Ordinary shares issuable for little or no cash or other consideration upon the satisfaction of specified conditions in a contingent share agreement. [IAS 33.5]
contract – An agreement between two or more parties that has clear economic consequences that the parties have little, if any, discretion to avoid, usually because the agreement is enforceable at law. Contracts may take a variety of forms and need not be in writing. [IAS 32.13]
control (of an entity) – The power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. [IAS 24.9, IAS 27.4, IAS 28.2, IAS 31.3, IFRS 3.A]
corporate assets – Assets other than goodwill that contribute to the future cash flows of both the cash-generating unit under review and other cash-generating units. [IAS 36.6]
corridor – A range around an entity’s best estimate of post-employment benefit obligations. [IAS 19.95]
cost – The amount of cash or cash equivalents paid or the fair value of the other consideration given to acquire an asset at the time of its acquisition or construction, or, when applicable, the amount attributed to that asset when initially recognized in accordance with the specific requirements of other IFRSs, [eg IFRS 2. IAS 16.6, IAS 38.8, IAS 40.5].
cost method – A method of accounting for an investment whereby the investment is recognized at cost. The investor recognizes income from the investment only to the extent that the investor receives distributions from retained earnings of the investee arising after the date of acquisition. Distributions received in excess of such profits are regarded as a recovery of investment and are recognized as a reduction of the cost of the investment. [IAS 27.4]
cost of inventories – All costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. [IAS 2.10]
cost of purchase – All of the purchase price, import duties and other taxes (other than those subsequently recoverable by the entity from the taxing authorities), and transport, handling and other costs directly attributable to the acquisition of the item. Trade discounts, rebates and other similar items are deducted in determining the costs of purchase. [IAS 2.11]
cost plus contract – A construction contract in which the contractor is reimbursed for allowable or otherwise defined costs, plus a percentage of these costs or a fixed fee. [IAS 11.3].
costs of conversion – Costs directly related to the units of production, such as direct labor together with a systematic allocation of fixed and variable production overheads that are incurred in converting materials into finished goods. [IAS 2.12]
costs of disposal – Incremental costs directly attributable to the disposal of an asset, excluding finance costs and income tax expense [ IAS 36.6]
costs to sell – The incremental costs directly attributable to the disposal of an asset (or disposal group), excluding finance costs and income tax expense. [IFRS 5.A]
credit risk – The risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. [IFRS 7.A]
currency risk – The risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. [IFRS 7.A]
current asset – An entity shall classify an asset as current when:
(a) it expects to realize the asset or intends to sell or consume it in its normal operating cycle;
(b) it holds the asset primarily for the purpose of trading;
(c) it expects to realize the asset within twelve months after the reporting period
(d) the asset is cash or a cash equivalent (as defined in IAS 7) unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. An entity shall classify all other assets as non-current. [IAS 1.66, IFRS 5.A]
current cost – The amount of cash or cash equivalents that would have to be paid if the same or an equivalent asset was acquired currently. The undiscounted amount of cash or cash equivalents that would be required to settle an obligation currently. [F.100(b)]
current liability – An entity shall classify a liability as current when:
(a) it expects to settle the liability in its normal operating cycle;
(b) it holds the liability primarily for the purpose of trading;
(c) the liability is due to be settled within twelve months after the reporting period; or
(d) the entity does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period.
An entity shall classify all other liabilities as non-current.
current service cost – The increase in the present value of the defined benefit obligation resulting from employee service in the current period. [IAS 19.7]
current tax – The amount of income taxes payable (recoverable) in respect of the taxable profit (tax loss) for a period. [IAS 12.5]
curtailment (of a defined benefit plan) – A curtailment occurs when an entity either:
(a) is demonstrably committed to make a material reduction in the number of employees covered by a plan; or
(b) amends the terms of a defined benefit plan such that a material element of future service by current employees will no longer qualify for benefits, or will qualify only for reduced benefits.
date of transition to IFRSs – The beginning of the earliest period for which an entity presents full comparative information under IFRSs in its first IFRS financial statements.
deductible temporary differences – Temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base that will result in amounts that are deductible in determining taxable profit (tax loss) of future periods when the carrying amount of the asset or liability is recovered or settled. [IAS 12.5]
deemed cost – An amount used as a surrogate for cost or depreciated cost at a given date. Subsequent depreciation or amortization assumes that the entity had initially recognized the asset or liability at the given date and that its cost was equal to the deemed cost. [IFRS 1.A]
deferred tax assets – The amounts of income taxes recoverable in future periods in respect of:
(a) deductible temporary differences;
(b) the carryforward of unused tax losses; and
(c) the carryforward of unused tax credits.
deferred tax liabilities – The amounts of income taxes payable in future periods in respect of taxable temporary differences. [IAS 12.5]
defined benefit liability – The net total of the following amounts:
(a) the present value of the defined benefit obligation at the end of the reporting period;
(b) plus any actuarial gains (less any actuarial losses) not recognized;
(c) minus any past service cost not yet recognized;
(d) minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.
defined benefit obligation (present value of) – The present value, without deducting any plan assets, of expected future payments required to settle the obligation resulting from employee service in the current and prior periods.
defined benefit plans – Post-employment benefit plans other than defined contribution plans. [IAS 19.7]
defined benefit plans – Retirement benefit plans under which amounts to be paid as retirement benefits are determined by reference to a formula usually based on employees’ earnings and/or years of service. [IAS 26.8].
defined contribution plans – Post-employment benefit plans under which an entity pays fixed contributions into a separate entity (a fund) and will have no legal or constructive
obligation to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods. [IAS 19.7]
defined contribution plans – Retirement benefit plans under which amounts to be paid as retirement benefits are determined by contributions to a fund together with investment earnings thereon. [IAS 26.8]
demonstrably committed – An entity is demonstrably committed to pay termination benefits when, and only when, an entity has a detailed formal plan for the termination and is without realistic possibility of withdrawal. The detailed plan shall include, as a minimum:
(a) the location, function, and approximate number of employees whose services are to be terminated;
(b) the termination benefits for each job classification or function; and
(c) the time at which the plan will be implemented.
Implementation shall begin as soon as possible and the period of time to complete implementation shall be such that material changes to the plan are not likely.
deposit component – A contractual component that is not accounted for as a derivative under IAS 39 and would be within the scope of IAS 39 if it were a separate instrument.
depreciable amount – The cost of an asset, or other amount substituted for cost (in the financial statements), less its residual value. [IAS 16.6, IAS 36.6, IAS 38.8]
depreciation (amortization) – The systematic allocation of the depreciable amount of an asset over its useful life. [IAS 16.6, IAS 36.6].
de-recognition (of a financial instrument) – The removal of a previously recognized financial asset or financial liability from an entity’s statement of financial position.
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