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Author's profile photo Patricia METEIL-DUTARTRE

Use SAP BusinessObjects Financial Consolidation to meet IFRS 5 requirements

IFRS 5 Non-current Assets Held for Sale and Discontinued Operations specifies the accounting for assets held for sale and the presentation of discontinued operations.

Version 10.0 of SAP® BusinessObjects™ Financial Consolidation is delivered with a new feature that can be leveraged to facilitate the processing of disposal groups and discontinued operations in the consolidated statements.

A working document is now available to help SAP BusinessObjects Financial Consolidation 10.0 users enhance their configuration to this end.

The purpose of this blog is to provide you with a high-level summary of the working document.

Firstly, the working document summarizes IFRS 5 requirements, focusing on aspects relating to consolidated financial statements. It points out that many practical issues arise when it comes to putting IFRS 5 in practice. Most of them proceed from a severe lack of guidance in IFRS 5.

For example:

  • How to deal with the elimination of intercompany transactions where one of the related parties is a discontinued operation?
  • How to disclose cash and cash equivalents included in disposal groups in the statement of cash flows?
  • How to present reclassification adjustments on other comprehensive income items that relates to disposal groups?

Secondly, the working document presents a brief overview of how to configure and use the new “scope custom property” feature of SAP BusinessObjects Financial Consolidation 10.0.

Lastly, the final part of this working document is dedicated to SAP BusinessObjects Financial Consolidation 10.0, starter kit for IFRS. After a reminder of how the current starter kit includes IFRS 5 requirements, possible enhancements are considered in order to ensure, on a more automated basis, the appropriate presentation of both assets and disposal groups held for sale and discontinued operations in the consolidated financial statements.

To consult the comprehensive document, please click here.

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      Author's profile photo Former Member
      Former Member
      Great article, another proof point of how SAP enables IFRS

      regards

      Muthu Rangathan
      (follow me @muthurangnathan