Cases
Practical case
Corvane SA (fictitious entity), an industrial group, closes its accounts on 31 December 20X6 under IAS 1. The audit committee asks for a transition note on IFRS 18: application date, classification of the IAS 1 requirements (transferred, unchanged, modified), departure proposal from management, capital disclosure and preparation of the 20X6 comparative under the new presentation. IAS 1 remains the standard applicable to the 20X6 financial statements.
Your assignment
State from when IFRS 18 replaces IAS 1 and what this implies for the 20X6 statements; classify the 9 areas of IAS 1 requirements (transferred to IAS 8, carried over without structural change, modified); judge the departure proposal; say what the status of the April 2026 agenda decision is; judge the accounting policy information and prepare the capital disclosure; record the reclassification for the IFRS 18 view of the comparative; present the links with the other standards and the effect of the entry; conclude.
Work on this file as you would in practice: read the situation, open the documents, sort the useful information, then carry out the work requested. The solution is revealed once you submit.
Autonomous professional situation
As on a real engagement: no method, no checklist and no hints. You identify the issues yourself, organise the work and defend your conclusion.
8 documents: open each one to read it.
Document 1Memo
Corvane SA (fictitious entity) makes industrial components and closes its accounts on 31 December 20X6 under IAS 1; its functional currency is the euro. Case conventions: amounts in EUR; case convention (pedagogical assumption, not attributed to the standard): profit or loss and other comprehensive income in two separate statements, no early application of IFRS 18, illustrative entry. The content of IAS 7, IAS 8 and IAS 33 is not duplicated.
The figures of the documents, gathered for your work.
| Item | Value | Found in |
|---|---|---|
| Areas of requirements to classify | 9 units | |
| Other operating expenses | €1,240,000.00 | |
| Loan interest included in this line | €52,000.00 | |
| Inventory write-down that management does not want to recognise | €380,000.00 | |
| Minimum equity of the policy | €9,000,000.00 | |
| Minimum equity imposed by the bank | €8,000,000.00 | |
| Equity at 31 December 20X6 | €10,200,000.00 | |
| Licence invoice | €23,000.00 |
Not every document matters: identify those that affect the accounting treatment.
Part 1 · Classification · Analysis
Sort each document: does it affect the accounting treatment?
Drag each item into its category, or tap the category under the item.
Group profile and case conventions
IFRS 18 transition note
Map of the 9 areas of IAS 1 requirements
20X6 statement of profit or loss under IAS 1 (extract)
Board of directors: departure proposal
Capital management
Context note: April 2026 agenda decision
Invoice for a software licence
Organise your work freely: deal with each point, then argue your conclusion.
Task 1Analysis
From when does IFRS 18 replace IAS 1 and what to do for the 20X6 statements?
Task 2Analysis
Classify the 9 areas of IAS 1 requirements: transferred to IAS 8, carried over without structural change or modified.
Task 3Professional judgement
Is the departure proposal of management justified?
Part 1 · Calculation
Is the departure proposal of management justified?
Task 4Analysis
What is the status of the April 2026 agenda decision?
Task 5Professional judgement
Is accounting policy information still required and on what criterion?
Task 6Analysis
Prepare the capital disclosure and say what the case does not allow to conclude about its destination.
Part 1 · Calculation
Prepare the capital disclosure and say what the case does not allow to conclude about its destination.
Task 7Journal entries
Record the reclassification of the interest for the IFRS 18 view of the comparative.
Part 1 · Journal entry · Journal entries
Entry 1 of 1
One line = one account and one side. Add a line if the entry needs more; the balance check updates live.
Line 1
Line 2
Task 8Professional judgement
For the reclassification of the EUR 52,000 of interest, justify what falls under IAS 1 / IFRS 18 (presentation) and what falls under IAS 7, IAS 8 and IAS 33, without duplicating their content.
Task 9Effects on the financial statements
What is the effect of the entry on the financial statements?
Part 1 · Classification · Analysis
State the direction of the effect on each financial statement aggregate.
Financial position (balance sheet)
Profit or loss
Other comprehensive income
Equity
Task 10Conclusion
Write the conclusion.
Your working draft for this file: points noted, leads, intermediate calculations.
Saved on this device only; never graded.
Complete every item of the file to submit it (0 / 13).
Document this file
These working papers use the data and results of this case.