Reference

Glossary

52 plain-English definitions of the IFRS terms you'll actually meet — grouped by topic, with the standard reference.

Accrual basis Framework · Conceptual Framework: Effects of transactions are recognised when they occur, not when cash is received or paid.
Amortised cost Measurement · IFRS 9: Initial measurement minus principal repayments, plus or minus cumulative amortisation using the effective interest method, less impairment.
Bargain purchase Consolidation · IFRS 3: Acquisition where the fair value of net assets acquired exceeds consideration transferred — the difference is recognised in profit or loss after reassessment.
Borrowing costs Other · IAS 23: Interest and other costs incurred in connection with borrowing funds; directly attributable amounts on qualifying assets are capitalised.
Carrying amount Measurement · IAS 16 / IAS 38: The value at which an asset or liability is recognised on the balance sheet, after deducting depreciation, amortisation, and impairment.
Constructive obligation Provisions · IAS 37: An obligation derived from past practice, published policy, or specific statement creating a valid expectation in third parties.
Contingent liability Provisions · IAS 37: A possible obligation arising from past events whose existence depends on uncertain future events, or a present obligation that is not probable or cannot be measured reliably — disclosed, not recognised.
Contract asset / liability Revenue · IFRS 15: A contract asset arises when performance precedes billing; a contract liability when consideration is received before performance.
Control Consolidation · IFRS 10: An investor controls an investee when it has power, exposure to variable returns, and the ability to use power to affect those returns.
Cost model Measurement · IAS 16: Asset carried at cost less accumulated depreciation and impairment.
Deferred tax asset Income Taxes · IAS 12: Tax recoverable in future periods in respect of deductible temporary differences, unused tax losses, and unused tax credits — recognised only to the extent recovery is probable.
Deferred tax liability Income Taxes · IAS 12: Tax payable in future periods in respect of taxable temporary differences.
Effective interest rate Measurement · IFRS 9: The rate that exactly discounts estimated future cash flows through the expected life of a financial instrument to its gross carrying amount.
Equity method Consolidation · IAS 28: Investment initially recognised at cost and adjusted thereafter for the investor's share of post-acquisition profits, OCI, and distributions.
Expected Credit Loss Financial Instruments · IFRS 9: A probability-weighted estimate of credit losses over the expected life of a financial instrument, reflecting the time value of money and reasonable, supportable information.
Fair value Measurement · IFRS 13: The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
Fair value hierarchy Measurement · IFRS 13: Three-level ranking of fair-value inputs: Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1), Level 3 (unobservable).
Faithful representation Framework · Conceptual Framework: Information that is complete, neutral, and free from error — depicting the substance of an economic phenomenon.
Functional currency FX · IAS 21: The currency of the primary economic environment in which the entity operates.
FVOCI Financial Instruments · IFRS 9: Fair value through other comprehensive income — used for certain debt instruments held within a hold-to-collect-and-sell business model.
FVTPL Financial Instruments · IFRS 9: Fair value through profit or loss — the default classification for financial assets that do not meet amortised cost or FVOCI criteria.
Going concern Framework · IAS 1: The assumption that an entity will continue operating for the foreseeable future, with no intention or need to liquidate.
Goodwill Consolidation · IFRS 3: The excess of consideration transferred plus NCI plus previously held interest, over the fair value of identifiable net assets acquired.
Hedge accounting Financial Instruments · IFRS 9: An optional accounting treatment that aligns the timing of gains and losses on a hedging instrument and the hedged item.
Incremental borrowing rate Leases · IFRS 16: The rate of interest a lessee would have to pay to borrow funds, over a similar term and with similar security, to obtain an asset of similar value to the right-of-use asset.
Lease liability Leases · IFRS 16: The present value of unpaid lease payments at commencement, discounted using the rate implicit in the lease or the incremental borrowing rate.
Materiality Framework · IAS 1 / IFRS Practice Statement 2: Information is material if omitting, misstating, or obscuring it could influence decisions made by primary users of the financial statements.
Net realisable value Measurement · IAS 2: Estimated selling price in the ordinary course of business less estimated costs of completion and costs necessary to make the sale.
Non-controlling interest Consolidation · IFRS 10: The equity in a subsidiary not attributable, directly or indirectly, to the parent.
Onerous contract Provisions · IAS 37: A contract in which the unavoidable costs of meeting the obligations exceed the economic benefits expected to be received.
Other Comprehensive Income Presentation · IAS 1: Items of income and expense that are not recognised in profit or loss as required or permitted by IFRS (e.g., revaluation surplus, FX on foreign operations).
Over-time recognition Revenue · IFRS 15: Revenue recognised as performance progresses when the customer simultaneously receives and consumes the benefits, the asset has no alternative use, or the customer controls the asset as it is created.
Performance obligation Revenue · IFRS 15: A promise in a contract to transfer a distinct good or service (or a series of substantially the same goods or services) to a customer.
Present value Measurement: The discounted amount of expected future cash flows at a rate that reflects the time value of money and risks specific to the asset or liability.
Presentation currency FX · IAS 21: The currency in which the financial statements are presented — can differ from the functional currency.
Provision Provisions · IAS 37: A liability of uncertain timing or amount, recognised when there is a present obligation, probable outflow, and reliable estimate.
Prudence Framework · Conceptual Framework: The exercise of caution under uncertainty so that assets and income are not overstated and liabilities and expenses are not understated.
Qualifying asset Other · IAS 23: An asset that necessarily takes a substantial period of time to get ready for its intended use or sale.
Recoverable amount Measurement · IAS 36: The higher of an asset's fair value less costs of disposal and its value in use.
Related party Disclosures · IAS 24: A person or entity related to the reporting entity through control, joint control, significant influence, or being key management personnel.
Revaluation model Measurement · IAS 16 / IAS 38: Asset carried at fair value at the revaluation date less subsequent depreciation and impairment.
Right-of-use asset Leases · IFRS 16: An asset representing a lessee's right to use an underlying asset over the lease term.
Short-term lease Leases · IFRS 16: A lease with a term of 12 months or less at commencement that does not contain a purchase option — exempt from recognition.
Significant Increase in Credit Risk Financial Instruments · IFRS 9: The trigger to move a financial asset from Stage 1 (12-month ECL) to Stage 2 (lifetime ECL); rebuttable presumption at 30 days past due.
Significant influence Consolidation · IAS 28: Power to participate in the financial and operating policy decisions of the investee, but not control — usually 20%–50% of voting rights.
Stand-alone selling price Revenue · IFRS 15: The price at which an entity would sell a promised good or service separately to a customer.
Substance over form Framework · Conceptual Framework: Transactions are accounted for according to their economic reality, not merely their legal form.
Tax base Income Taxes · IAS 12: The amount attributed to an asset or liability for tax purposes.
Temporary difference Income Taxes · IAS 12: Difference between the carrying amount of an asset or liability and its tax base, leading to deferred tax.
Transaction price Revenue · IFRS 15: The amount of consideration an entity expects to be entitled to in exchange for transferring promised goods or services, excluding amounts collected for third parties.
Value in use Measurement · IAS 36: Present value of future cash flows expected from continued use of an asset and its disposal at the end of its useful life.
Variable consideration Revenue · IFRS 15: Consideration that can vary due to discounts, rebates, refunds, performance bonuses, or similar items, estimated using expected value or most likely amount.

Definitions are simplified for learning — always consult the standard for application.