HKFRS News 

In this newsletter, we look at the following topics:

HK(IFRIC)-Int 11: HKFRS 2 - Group and treasury share transactions
 
Hong Kong Institute of Certified Public Accountants (HKICPA) published HK(IFRIC)-Int 11: HKFRS 2 - Group and Treasury Share Transactions in January 2007.  This interpretation applies to annual periods beginning on or after 1 March 2007 and should be applied retrospectively.  Earlier application is permitted.  Entities that apply it to an annual period beginning before that date should disclose this fact.

Download our newsletter below to read more about:

• HK(IFRIC)-Int 11: equity-settled awards and group schemes
• Additional considerations
• Funding arrangements between parent and subsidiary
• Consolidation adjustments
• Practical considerations

Scope and impact of HK(IFRIC)-Int 12 - Service concession arrangements
 
The HKICPA has approved HK(IFRIC)-Int 12, Service Concession Arrangements (expected to be published in February 2007).  This interpretation applies to companies that participate in service concession arrangements.  It provides guidance on the accounting by operators in public-to-private service concession arrangements.  HK(IFRIC)-Int 12 applies to the annual periods beginning on or after 1 January 2008.  Earlier application is permitted.  Entities that apply it to an annual period beginning before that date should disclose the fact.
 
Retrospective application is required for service concession arrangements within the scope of the interpretation, except in the rare circumstance when retrospective application is impracticable.  The comparative period for most companies will cover all or a portion of 2007.

Download our newsletter below to read more about:

• What arrangements are within the scope of HK(IFRIC)-Int 12?
• What are the major implications?
• Two different accounting models
• Recognition and measurement of revenues - separation of different components
• What remains unchanged?
• Contractual obligation
• Borrowing costs
• Disclosure
• What further changes to expect?
• Amortisation and depreciation

Note: HKFRS has converged with IFRS effective from 1 January 2005.  Contents contained in this newsletter are relevant to both HKFRS preparers and IFRS preparers.