the accounting treatment of lease incentives that may result from the way lease incentives are presented in
the example.
IAS 16 Property, Plant and Equipment (Amendment) – “Proceeds before intended use”
The amendment changes the way the cost of the asset's proper functioning tests and the net proceeds of the
sale from sales of items produced during the process of placing the asset in that location and situation are
recognised. The revenues and production costs of these products will now be recognised in the profit and loss
account instead of being shown deducted in the assets’ acquisition cost. It requires the entities to disclose
separately the amount of sales proceeds and costs associated with such produced items that are not the
result of the entity's ordinary activity.
The amendment is applicable for annual periods beginning on or after 1 January 2022.
IAS 37 Provisions, contingent liabilities and contingent assets (Amendment) – “Onerous contracts -
Cost of fulfilling a contract”
The amendment determines what expenses an entity should include in determining the costs of fulfilling a
contract for the purpose of assessing whether the contract is onerous. The amendment specifies that “the
cost of fulfilling a contract” comprises the costs that relate directly to the contract and the allocation of other
costs directly related to its performance. The amendment also clarifies that, before a separate provision for an
onerous contract is recognised, an entity recognises any impairment loss on the assets used to fulfil the
contract, and not on assets dedicated only to that contract.
The amendment is applicable for annual periods beginning on or after 1 January 2022.
Standards and Interpretations mandatory for subsequent periods that have not been earlier applied by
the Company (or/and the Group) and have not been adopted by the E.U.:
The amendments below are not expected to have a material impact on the financial statements of the
Company (or/and the Group), unless otherwise stated.
IAS 1 Presentation of financial statements (Amendment) - “Classification of Liabilities as Current or
Non-Current”
The amendment affects only the presentation of liabilities in the statement of financial position. The
amendment specifies that the classification of liabilities should be based on existing rights at the end of the
reporting period. The amendment also clarified that Management's expectations for events expected to occur
after the balance sheet date should not be taken into account and clarified the circumstances that constitute a
settlement of the liability.
The amendments shall be effective for annual reporting periods beginning on or after 1 January 2023.
IAS 1 Presentation of financial statements and IFRS Practice Statement 2: Disclosures on accounting
policies (Amendments)
On 12 February 2021, the International Accounting Standards Board issued an amendment to IAS 1
specifying that:
- The definition of accounting policies is given in paragraph 5 of IAS 8.
- An entity should disclose the significant accounting policies. Accounting policies are significant where,
together with the other information included in the financial statements may affect the decisions taken by the
main users of the financial statements.
- Accounting policies for non-significant transactions are considered non-significant and should not be
disclosed. Accounting policies, however, may be significant depending on the nature of some transactions
even if the amounts involved are not significant. Accounting policies related to significant transactions and
events are not always significant in their entirety.
- Accounting policies are significant when users of financial statements need them in order to understand
other significant information in the financial statements.
- The information on how an entity has implemented an accounting policy is more useful to users of
financial statements than standard information or summary of IFRS provisions
- In case the entity chooses to include non-significant information on accounting policies, such
information should not interfere with significant information on accounting policies.
In addition, guidance and illustrative examples are added to the Practice Statement 2 to help companies apply
the concept of materiality in making decisions about accounting policy disclosures.