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Explain IAS/IFRS Requirements The financial controller at Monkton plc is unwell and is unable to come into work. You have been asked to assist the junior accountant by providing guidance on how the following transactions that have not yet been entered in the accounting system ought to be reported in the financial statements for the year ended 30 June 2014 Monkton has a property on its books at net book value which was acquired on 01 July 2011. The original cost was 1,100,000 and the property has a useful economic life of 4 years. The directors believe the property could be sold at the end of its useful economic life for 300,000. It has been revalued at 01 July 2013 at 1,300,000. Its residual remains at 300,000 and the estimated remaining useful is 4 years from 01 July 2013. The company policy is to provide a full year's depreciation in the year of acquisition and no depreciation in the year of sale On 01 July 2013 there had been a new issue of shares. 2 million shares with a nominal value of 50p were issued at a market value of 1.75 . Monkton has received a grant of 60,000 from local government to help to pay for staff training costs. The training started on 01 January 2014 and it will take until 31 December 2015 to train all the staff. The total cost of training is expected to be 180,000 and the costs will accrue evenly over the two year period. . The directors are aware that a customer is taking legal action against the company. The lawyers have advised that there is a 60% chance that the company will lose the case and have to pay damages. If the company has to pay damages the estimated damages are as follows. Amount 100,000 200,000 300,000 Probability 30% 50% 20% Explain to the junior accountant of Monkton, with supporting calculations, how the above transactions should be recognised measured and presented in the financial statements for the year ended 30 June 2014 You should make reference to appropriate IAS/IFRS in your

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