NEW PSAK [EFFECTIVE JAN 1, 2020]
There are some changes in PSAK in Indonesia that may major impact in following years
- PSAK 71 : Financial Instruments
- PSAK 72 : Revenue from Contracts with Customers
- PSAK 73 : Leases
- These statements effective immediately on Jan 1, 2020.
- Full retrospectives or modified retrospectives
Adoption from IFRS 9 : Financial Instruments, replacing PSAK 55.
Four classification in PSAK 55 changed to three classification in PSAK 71. These classifications will be tested by SPPI and Business Model.
Incurred Loss Model —> Expected Loss Model
Hedge accounting under PSAK 55 was criticized for being: Complex, Rules based, Not aligned with risk management practices.
Objective of new hedge accounting model in PSAK 71: Represent in the financial statements the effect of an entity’s risk management activities.
REVENUE FROM CONTRACTS WITH CUSTOMERS
Adoption from IFRS 15 : Revenue from Contracts with Customers, replacing PSAK 23.
5-step model for revenue recognition
Identify the contract
- Parties have approved the contract and are committed to perform
- Each party’s rights to goods/services can be identified
- The payment terms for goods/services can be identified
- The contract has ecommercial substance
- It is probable that an entity will collect the consideration
Identify the PO
Promise in a contract with a customer to transfer to the customer either:
- Good/service that is distinct
- Series of distinct goods/services that are substantially the same and have the same pattern of transfer
- Amount of consideration to which the entity expects to be entitled in exchange for transferring promised goods/services to a customer excluding the amounts collected on behalf of third parties.
- Variable consideration
- Constraining estimates in variable consideration
- Existence of significant financing component
- Non-cash consideration
- To allocate the TP to each PO in an amount that depicts the amount the consideration for transferring promised goods/services
- Based on relative stand-alone selling prices
- The price at which the entity would sell promised goods/services separately to the customer
PO is satisfied when a promised good/service is transferred to a customer
Adoption from IFRS 16 : Leases, replacing PSAK 30.