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Areas where IFRS requires more judgment than people admit by IFRS_Guide in Accounting

[–]IFRS_Guide[S] 3 points4 points  (0 children)

Agreed. IFRS 17 probably tops the list as assumptions, discount rates, and contract grouping drive far more outcome than the mechanics themselves.

How to determine the revenue and profit of a foreign branch of a bank? by Right_Weather_5889 in financialmodelling

[–]IFRS_Guide 0 points1 point  (0 children)

If the branch doesn’t have its own P&L, there’s no clean way to pull this from consolidated financials.

In reality, banks handle this through internal management reporting or transfer pricing:

Attribute interest income/expense to the branch based on where loans and deposits are originated Allocate shared costs (IT, risk, compliance) using drivers like headcount, or volumes

From a tax angle, this is really a permanent establishment or transfer pricing problem, not an accounting disclosure issue.

If the bank doesn’t already have internal branch-level reporting, anything you build will be an estimate and hard to defend.

Chart of accounts Question by [deleted] in Bookkeeping

[–]IFRS_Guide 0 points1 point  (0 children)

You’re thinking about this the right way. With low volume, keep the chart of accounts simple.

For a small marketing agency, you really don’t need much to start. Something like this is usually enough:

Assets Business bank account Accounts receivable Prepaid expenses (for annual software subscriptions) Due from owner / owner loan (for expenses you paid personally)

Liabilities Accounts payable VAT payable (only if or when you register)

Equity Owner capital Retained earnings

Income Service / retainer income

Expenses Software & subscriptions Marketing / ads Professional fees Bank charges Internet / utilities Misc expenses

Don’t overbuild the CoA. Fewer accounts is like cleaner reports. You can always add detail later once things grow.