CERTYNEX IFRS ACADEMY

For its notes, Atlas SA identifies two matters (case facts). Matter 1: after analysing its contracts, management concludes that Atlas acts on its own account in a trading activity; this conclusion involves no estimation and has the most significant effect on the revenue recognised. Matter 2: the measurement of a litigation provision rests on assumptions about the outcome of a lawsuit and carries a significant risk of a material adjustment to its carrying amount within the next financial year. How does IAS 1 treat these two matters in the notes?

Matter 1 is disclosed among the judgements made in applying the accounting policies; matter 2 among the major sources of estimation uncertainty.

Both matters are estimates: only the assumptions used for the provision are disclosed.

Matter 2 is disclosed among the judgements made in applying the accounting policies; matter 1 need not be disclosed.

Neither matter is disclosed, since the amounts concerned are already recognised in the financial statements.