Additional Requirements in Applying TFRS for NPAEs
The Federation of Accounting Professions (‘FAP’) has launched three announcements with regards to Thai Financial Reporting Standards (‘TFRS’).
Keywords: Mazars, Thailand, Accounting, TFRS, NPAE, FAP, TAS
Announcement No. 13/2555
In order for NPAEs to reduce the cost of preparing financial statements, the FAP has drawn up the following additional requirements:
1) Chapter 4: Presentation of Financial Statements
Paragraph 33 requires the entity who prepares interim financial statements to follow all requirements stated in TFRS for NPAEs. However, the FAP allows NPAEs to do the following:
- NPAEs who wish to recognise tax expense/income and tax assets/liabilities by using the liability method and to follow the existing TFRS can do so and shall follow the TAS12.
- NPAEs who wish to recognise a provision for employee benefits and to follow the existing TFRS can do so and shall follow the TAS19.
- NPAEs can present its interim financial statements following TAS34 Interim Financial Reporting in the section relevant to the presentation and disclosure of the financial statement. NPAEs can omit those subjects that are not applicable to the NPAEs e.g. preparation of cash flows, earning per share and diluted earnings per share, disclosure of related parties.
2) Chapter 7: Accounts Receivable – Recovery of Bad Debts
An entity can record the bad debt recovery as other income in the profit and loss statement. The entity shall disclose its accounting policy for bad debt recovery in the notes to financial statements.
3) Chapter 10: Property, Plant and Equipment - Subsequent Measurement
Paragraph 136 requires an entity to recognise the loss from a decrease in value of assets (when lower than net book value) by estimation of the selling price after deducting the cost to sell.
The FAP allows an entity to use the asset’s value in use instead of the selling price when the value in use is higher than the estimated selling price deducted by the cost to sell.