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IFRS versus US GAAP REGULATIONS:

Section titled “IFRS versus US GAAP REGULATIONS:”
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About this guide
PwC is pleased to offer our updated IFRS and US GAAP: similarities and differences
guide. This publication is designed to alert companies, investors, and other capital
market participants to the major differences between IFRS and US GAAP as they exist
today.
It would appear that the use of IFRS in the United States by public companies is off
the table, at least for now. However, as discussed in Chapter 1, being financially
bilingual is increasingly important for US capital market participants due to IFRS
reporting demands of multinational companies, cross-border merger and acquisition
activity, and the IFRS reporting demands of non-US stakeholders.
Each topical chapter consists of the following:
A conceptual discussion of the current IFRS and US GAAP similarities and
differences
A detailed analysis of current differences between the frameworks, including an
assessment of the impact of the differences
In addition, this publication includes an overview of IFRS for small and medium-
sized entities.
This publication is not all-encompassing. It focuses on those differences that we
generally consider to be the most significant or most common. When applying the
individual accounting frameworks, companies should consult all of the relevant
accounting standards and, where applicable, national law.
Summary of significant change
Following is a summary of the noteworthy revisions to the guide since it was last
updated in August 2019. Additional updates may be made to keep pace with
significant developments.
Revisions made in 1oYHPber 2020
Chapter 2, IFRS First time adoption
Ŀ SD 2.1.4 was added to provide guidance required by IFRS 1 on the reconciliation
of equity and total comprehensive income.
Chapter 6, Assets – non-financial assets
Ŀ SD 6.6 was updated to reflect the IFRIC decision from March 2019 regarding a
cXVWomer¶V right to receive access to the sXpplier¶V software hosted on the cloud.
Ŀ Former SD 6.17 was removed since it referred to superseded GAAP.
ii PwC
Chapter 8 – Liabilities - taxes
Ŀ SD 8.2,  SD 8.6, SD 8.14 and SD 8.17 were updated  to reflect ASU 2019-
12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.
Ŀ SD 8.19.1 and SD 8.19.2 were removed since they dealt with historical tax
provisions that are no longer relevant.
Copyrights
This publication has been prepared for general informational purposes, and does not
constitute professional advice on facts and circumstances specific to any person or
entity. You should not act upon the information contained in this publication without
obtaining specific professional advice. No representation or warranty (express or
implied) is given as to the accuracy or completeness of the information contained in
this publication. The information contained in this publication was not intended or
written to be used, and cannot be used, for purposes of avoiding penalties or sanctions
imposed by any government or other regulatory body. PricewaterhouseCoopers LLP,
its members, employees, and agents shall not be responsible for any loss sustained by
any person or entity that relies on the information contained in this publication.
Certain aspects of this publication may be superseded as new guidance or
interpretations emerge. Financial statement preparers and other users of this
publication are therefore cautioned to stay abreast of and carefully evaluate
subsequent authoritative and interpretative guidance.
PwC 1-1
Chapter 1:
Importance of being
financially bilingual—
updated November 2020
Importance of being financially bilingual
1-2 PwC
1.1 Overview
Most Rf Whe ZRUld¶V significant capital markets now require IFRS, or some form
thereof, for financial statements of public-interest entities. For specific country data,
Vee Whe IASB¶V jXUiVdicWiRnal SURfileV (http://www.ifrs.org/Use-around-the-
world/Pages/Jurisdiction-profiles.aspx).
The remaining major capital markets without an IFRS mandate are:
Ŀ The US, with no current plans to change for domestic registrants (full IFRS
allowed for non-US filers);
Ŀ Japan, where voluntary adoption is allowed, but no mandatory transition date has
been established;
Ŀ China, whose accounting standards are converged with IFRS to some extent.
IFRS requirements elsewhere in the world impact US companies through statutory
reporting requirements of US multinationals, cross-border merger and acquisition
(M&A) activity, and the IFRS reporting demands of non-US stakeholders. It is clear
from a preparer perspective that being financially bilingual in the US is important.
From an investor perspective, the need to understand IFRS is arguably even greater.
US investors keep looking overseas for investment opportunities. Recent estimates
suggest that trillions of US capital are invested in foreign securities. The US markets
also remain open to non-US companies that prepare their financial statements using
IFRS. There are currently approximately 500 non-US filers with market capitalization
in the multiple of trillions of US dollars that use IFRS without reconciliation to US
GAAP.
To assist investors and preparers in obtaining this bilingual skill, this publication
provides a broad understanding of the major differences between IFRS and US GAAP
as they exist today. While this publication does not cover every difference between
IFRS and US GAAP, it focuses on those differences we generally consider the most
significant or most common.
1.2 IFRS affects US businesses in multiple ways
While the use of IFRS in the US by public companies will not be required in the
foreseeable future, IFRS is relevant to many US businesses. Companies will be
affected by IFRS at different times and to a different degree, depending on factors
such as size, industry, geographic makeup, M&A activity, and global expansion plans.
The following discussion expands on these impacts.
1.2.1 Mergers and acquisitions and capital-raising
Global economic slowdown caused by the Covid-19 pandemic led to a decline in the
volume of global M&A transactions in 2020. However, we expect that as world
economies recover, M&A activity will recover. For companies that look outside their
Importance of being financially bilingual
PwC 1-3
borders for potential buyers, targets, and capital, knowledge and understanding of
IFRS become increasingly important. Significant differences in both bottom-line
impact and disclosure requirements exist between IFRS and US GAAP.
Understanding these differences and their impact on key deal metrics, as well as on
both short- and long-term financial reporting requirements, will lead to a more
informed decision-making process and help minimize late surprises that could
significantly impact deal value or timing.
1.2.2 Non-US stakeholders
 Many US companies have non-US stakeholders. These stakeholders may require
IFRS financial information, audited IFRS financial statements, and budgets and
management information prepared under IFRS.
1.2.3 Non-US subsidiaries
Many countries require or permit IFRS for statutory financial reporting purposes,
while other countries have incorporated IFRS into their local accounting framework
used for statutory reporting. As a result, multinational companies should, at a
minimum, monitor the IFRS activity of their non-US subsidiaries. Complex
transactions, new IFRS standards, and changes in accounting policies may have an
impact on an organization beyond that of a specific subsidiary.
1.3 Our point of view
In conclusion, we continue to believe in the long-term vision of a single set of
consistently applied, high-quality, globally accepted accounting standards. However,
acceptance of an outright move to international standards is off the table, at least for
now. In the meantime, the FASB and IASB should focus on improving the quality of
their standards while, if possible, avoiding the introduction of differences in areas that
are converged between IFRS and US

FINANCIAL STATEMENT PRESENTATION PER US GAAP:

Section titled “FINANCIAL STATEMENT PRESENTATION PER US GAAP:”
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About this guide
PwC is pleased to offer our Financial statement presentation guide. This guide serves as a
compendium of many of today’s presentation and disclosure requirements included in US GAAP,
including relevant references to and excerpts from the FASB’s Acco unting Standards Codifi cati on (the
Codification). It also provides our insights and perspectives, interpretative and application guidance,
illustrative examples, and discussion on emerging practice issues.
This guide also discusses the requirements in S-X, Article 5, for commercial and industrial companies.
In most cases, the content does not include the requirements of other Articles of Regulation S-X or
other industry-specific guidance. However, some chapters address topics relevant to reporting entities
in other industries, such as investments and derivatives.
Appropriate financial statement presentation and disclosure is key to achieving the objectives of
financial reporting, including providing decision-useful information to investors, lenders, creditors,
and other stakeholders. This guide has been prepared to support practitioners in the preparation of
their financial statements. It should be used in combination with a thorough analysis of the relevant
facts and circumstances, review of the authoritative accounting literature, and appropriate
professio nal and technical advice.
The guidance in this guide is applicable to reporting entities that are going concerns and addresses
financial statement presentation and disclosure related to the core financial statements. As a result,
the following areas are not addressed in this guide:
Ŀ Management Discussion and Analysis (MD&A)
Ŀ Regulation S-K reporting
PwC’s Bankruptcies and liquidations guide addresses the presentation and disclosure requirements
applicable to entities reporting on a liquidation basis.
References to US GAAP
Definitions, full paragraphs, and excerpts from the FASB’s Accounting Standards Codification are
clearly labelled. In some instances, guidance was cited with minor editorial modification to flow in the
context of the PwC Guide. The remaining text is PwC’s original content.
References to other PwC guidance
This guide provides general and specific references to chapters in other PwC guides to assist users in
finding other relevant information. References to other guides are indicated by the applicable guide
abbreviation followed by the specific section number. The other PwC guides referred to in this guide,
including their abbreviations, are:
Ŀ Bankruptcies and liquidations (BLG)
Ŀ Business combinations and noncontrolling interests (BCG)
About this guide
Ŀ Carve-out financial statements (CO)
Ŀ Consolidation guide (CG)
Ŀ Derivative and hedging (DH)
Ŀ Fair value measurements, global edition (FV)
Ŀ Financing transactions (FG)
Ŀ Income taxes (TX)
Ŀ Leases (LG)
Ŀ Loans and investments (LI)
Ŀ Not-for-profit entities (NP)
Ŀ Property, plant, equipment and other assets (PPE)
Ŀ Revenue from contracts with customers (RR)
Ŀ Stock-based compensation (SC)
Ŀ Transfers and servicing of financial assets (TS)
Ŀ Utilities and power companies (UP)
Summary of significant changes
Included below is a summary of the noteworthy revisions to the Financial statement presentation
guide since it was last updated in October 2019.
Revisions made in November 2020
FSP 6, Statement of cash flows
Ŀ The order of certain sections within Chapter 6 was rearranged, while certain sections were also
combined.
Ŀ FSP 6.5.1 and FSP 6.5.2.1 were added to include discussion on the definition of cash and the
treatment of credit card and debit card payments in transit, respectively.
Ŀ FSP 6.9.10 was updated to expand on the classification of cash flows in a troubled debt
restructuring.
Ŀ Discussion of the cash flow presentation of lease-related accounts previously included in FSP
6.9.18 was moved to LG 9.2.3 and LG 9.3.3.
Ŀ FSP 6.9.21 was updated to discuss the cash flow treatment of working capital adjustments from
business combinati ons and in carve-ou t financial st atements.
FSP 19, Derivatives and Hedging
Ŀ Various updates were made to reflect the issuance of ASU 2019-04, Codification Improvements to
Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic
825, Financial Instruments.
Revisions made in August 2020
FSP 3, Income statement
Ŀ FSP 3.10 was updated to expand on accounting for government assistance provided to business
entiti es.
Ŀ Revenue presentation and disclosure content previously included in FSP 3 was moved to FSP 33.
FSP 17, Business combinations
Ŀ FSP 17.4.15.2 was updated to reflect the May 2020 amendments to Regulation S-X, Article 11 pro
forma disclosure requirements applicable to acquisitions and dispositions of businesses.
Ŀ FSP 17.6.5 was added to include an illustrative example of “blackline” financial statements.
FSP 33, Revenue and contract costs
Ŀ FSP 33 was added to include discussion of presentation and disclosures for revenue and contract
costs (previously in RR 12 and FSP 3).
Revisions made in June 2020
FSP 16, Income taxes
Ŀ FSP 16.8.2 was updated to reflect ASU 2019-12, Income Taxes (Topic 740): Simplifying the
Accounting for Income Taxes.
FSP 26, Related parties
Ŀ FSP 26 was updated to include insight on the impact of the ASC 326 cumulative expected credit
loss model on related party loans.
FSP 31, Parent company financial statements
Ŀ FSP 31 was updated to reflect the issuance of the new Regulation S-X Rule 13-01 and Regulation S-
X Rule 13-02, and amendments to Regulation S-X Rule 3-10 and Regulation S-X Rule 3-16.
Copyrights
This publication has been prepared for general informational purposes, and does not constitute
professio nal advice on facts and circumstances specific to any person or entity. You should not act
upon the information contained in this publication without obtaining specific professional advice. No
representation or warranty (express or implied) is given as to the accuracy or completeness of the
information contained in this publication. The information contained in this publication was not
About this guide
intended or written to be used, and cannot be used, for purposes of avoiding penalties or sanctions
imposed by any government or other regulatory body. PricewaterhouseCoopers LLP, its members,
employees, and agents shall not be respo nsible for any loss sustained by any person or entity that
relies on the information contained in this publication. Certain aspects of this publication may be
superseded as new guidance or interpretations emerge. Financial statement preparers and other users
of this publication are therefore cautioned t o st ay abre ast  of and carefu lly e valuate su bsequent
authoritative and interpretative guidance.
The FASB Accounting Standards Codification® and the FASB Concepts Statements are copyrighted
by the Financi al Accounti ng Foundati on (FAF) , 401 Merritt 7, PO Box 5116, Norwalk, Connecticut,
06856-5116, U.S.A., and are reproduced with permission. Complete copies of the documents are
available from the FAF.
PwC 1-1
Chapter 1:
General presentation and
disclosure requirements
General presentation and disclosure requirements
1-2
1.1 Chapter overview
This chapter provides an introduction to the general concepts of presentation and disclosure that
underlie the detailed guidance that is covered in the remaining chapters of this guide.
1.2 General presentation and disclosure requirements for
all reporting entities
ASC 205, Presentation of Financial Statements, provides the baseline authoritative guidance for
presentation of financial statements for all US GAAP reporting entities. ASC 205-10-45-1A lists the
required financial statements under US GAAP.
ASC 205-10-45-1A
A full set of financial statements for a period shall show all of the following:
a. Financial position at the end of the period
b. Earnings (net income) for the period, (which may be presented as a s

IFRS SUMMARIZED:

Section titled “IFRS SUMMARIZED:”
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IFRS in your pocket
2019
Abbreviations 1
Foreword 2
Our IAS Plus website 3
IFRS Standards around the world 5
The IFRS Foundation and the IASB 7
Standards and Interpretations 15
Standards and Interpretations 24
Summaries of Standards and Interpretations
in effect at 1 January 2019 29
Requirements that are not yet mandatory 100
IASB projects 104
Deloitte IFRS resources 111
Contacts 113
Contents
IFRS in your pocket |2019
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Abbreviations
ARC Accounting Regulatory Commission
ASAF Accounting Standards Advisory Forum
DP Discussion Paper
EC European Commission
ED Exposure Draft
EFRAG European Financial Reporting Advisory Group
GAAP Generally Accepted Accounting Principles
IAS International Accounting Standard
IASB International Accounting Standards Board
IASC  International Accounting Standards Committee
(predecessor to the IASB)
IFRIC  Interpretation issued by the IFRS Interpretations
Committee
IFRS International Financial Reporting Standard
IFRS Standards  All Standards and Interpretations issued by the IASB
(i.e. the set comprising every IFRS, IAS, IFRIC and SIC)
PIR Post-implementation Review
SEC US Securities and Exchange Commission
SIC  Interpretation issued by the Standing Interpretations
Committee of the IASC
SMEs Small and Medium-sized Entities
XBRL Extensible Business Reporting Language
XML Extensible Markup Language
IFRS in your pocket |2019
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Foreword
Welcome to the 2019 edition of IFRS in Your Pocket.
It is a concise guide of the IASB’s standard-setting activities that
has made this publication an annual, and indispensable, worldwide
favourite.
At its core is a comprehensive summary of the current Standards
and Interpretations along with details of the projects on the IASB
work plan. Backing this up is information about the IASB and an
analysis of the use of IFRS Standards around the world. It is the
ideal guide, update and refresher for everyone involved.
This is another year of important changes in IFRS. IFRS 16 Leases
is mandatory for annual periods beginning on or after 1 January
2019, along with a new Interpretation on uncertain tax positions
and seven amendments to Standards, of which four resulted from
the IASB’s Annual Improvement process.
Further along the horizon IFRS 17 Insurance Contracts is effective
from 1 January 2021, although that is likely to be deferred until
1 January 2022.
The IASB will also be seeking input on other projects. We expect
to see continued activity on the projects under the umbrella of
Better Communication in Financial Reporting and a broad range of
research projects, including wider corporate reporting.
With so much going on, the best way you can keep up to date
continuously with the latest developments in the arenas of
international and domestic financial reporting, is through our
website www.iasplus.com . It is widely regarded as the most
comprehensive source of news, and comment, about international
financial reporting available today.
Veronica Poole
Global IFRS Leader
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Our IAS Plus website
Deloitte’s IAS Plus ( www.iasplus.com ) is one of the most comprehensive
sources of global financial reporting news on the Web. It is a central
repository for information about International Financial Reporting
Standards as well as the activities of the IASB. The site, which is also
available in German, includes portals tailored to the United Kingdom,
the United States, and Canada (in English and French) each with a
focus on local GAAP and jurisdiction-specific corporate reporting
requirements.
IAS Plus features:
 • News about global financial reporting developments, presented
intuitively with related news, publications, events and more
 • Pre-meeting summaries of the topics being discussed by the IASB
and IFRS Interpretations Committee, and summaries of the meeting
discussions and decisions reached
 • Summaries of all Standards, Interpretations and projects, with
complete histories of developments and standard-setter discussions
together with related news and publications
 • Rich jurisdiction-specific information, including background and
financial reporting requirements, links to country-specific resources,
related news and publications and a comprehensive history of the
adoption of IFRS Standards around the world
 • Detailed personalisation of the site, which is available by selecting
particular topics of interest and creating tailored views of the site
IFRS in your pocket |2019
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 • Dedicated resource pages for research and education, sustainability
and integrated reporting, accounting developments in Europe, XBRL
and Islamic accounting
 • Important dates highlighted throughout the site for upcoming
meetings, deadlines and more
 • A library of IFRS-related publications available for download and
subscription including our popular IFRS in Focus newsletter and other
publications
 • Model IFRS financial statements and checklists, with versions
available tailored to specific jurisdictions
 • An extensive electronic library of both global and jurisdiction-specific
IFRS resources
 • Expert analysis and commentary from Deloitte subject matter
experts, including webcasts, podcasts and interviews
 • E-learning modules for most of the IASB’s Standards
 • Enhanced search functionality, allowing easy access to topics of
interest by tags, categories or free text searches, with search results
intuitively presented by category with further filtering options
 • Deloitte comment letters to the IASB and numerous other bodies
 • An interface that is smart-device friendly and updates through Twitter
and RSS feeds
IFRS in your pocket |2019
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IFRS Standards around the
world
Most jurisdictions have reporting requirements for listed and other
types of entities that include presenting financial statements that are
prepared in accordance with a set of generally accepted accounting
principles. IFRS Standards are increasingly that prescribed set of
principles and are used extensively around the world.
We maintain an up-to-date summary of the adoption of IFRS Standards
around the world on IAS Plus at: http://www.iasplus.com/en/resources/
ifrs-topics/use-of-ifrs
The IFRS Foundation publishes individual jurisdictional profiles which
can be found in: http://www.ifrs.org/Use-around-the-world/Pages/
Jurisdiction-profiles.aspx
Europe
43 jurisdictions in Europe require IFRS Standards to be applied by all
or most of their domestic publicly accountable entities. Switzerland
permits the use of IFRS Standards.
Europe has a strong endorsement process that requires each
new Standard or Interpretation, or amendment to a Standard or
Interpretation, be endorsed for use in Europe. That process involves:
 • translating the Standards into all European languages;
 • the private-sector EFRAG giving its endorsement advice to the EC;
 • the EC’s ARC making an endorsement recommendation; and
 • the EC submitting the endorsement proposal to the European
Parliament and to the Council of the EU.
Both must not oppose (or in certain circumstances must approve)
endorsement within three months, otherwise the proposal is sent
back to the EC for further consideration. Further information on
endorsement is available from Deloitte: http://www.iasplus.com/
en/resources/ifrs-topics/europe . The most recent status on EU
endorsement of IFRS Standards can be found at: http://www.efrag.
org/Endorsement . The UK is considering how the adoption of new IFRS
requirements will be undertaken after the UK leaves the EU.
The Americas
27 jurisdictions in the Americas require IFRS Standards to be applied
by all or most of their domestic publicly accountable entities. A further
8 jurisdictions permit or require IFRS Standards for at least some
domestic publicly accountable entities.
IFRS in your pocket |2019
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In the United States, foreign private issuers are permitted to submit
financial statements prepared using IFRS Standards as issued by the
IASB without having to include a reconciliation of the IFRS figures to
US GAAP. The SEC does not permit its domestic issuers