© 2009 IBM CorporationIBM Confidential – Internal Use Only

Proposed IFRS changes and their impact on IBM Cognos's Financial Solutions – Update August 23, 2014Author: Paul Young, CGA Proven Practice Advisor Business Analytics IBM Canada Inc.

© 2009 IBM Corporation

IBM Confidential – Internal Use Only

2

Agenda

• Project Plan• Major Standards• New SEC Filing• Annual Budgeting Cycle• Risk Management

© 2009 IBM Corporation

IBM Confidential – Internal Use Only

Leases – IAS 17

New Lease Proposal will make no distinction between Capital and Operating Leases. All leases with the exception of the following will be accounted for using the right-to-use model:• Mineral rights leases• Leases < 1 yearThe new proposal will required the lease to be set up as an asset with its corresponding liability. Balance SheetRight to Use – AssetLiability under right to useIncome StatementLease Expense – right to useFinancial Charge – LeaseWhat’s Next• IFRS has approved the new leasing standard. The effective date is 2019.

Earlier adopters can move up the date if they have already changed to the new revenue recognition standard for contracts

Options• Leasing is currently part of the notes/exhibit, but on annual basis. The new

standard will make the leasing reporting part of the 10Q as well as regular monthly reporting for business

• FASB (USA) will use a dual leasing model which could trigger FASB GAAP/ IFRS GAAP reconciliation

• Cognos Disclosure Management/TM1 could be used as part of the reporting requirement for Leases