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Adviser alert – IFRS Viewpoint – October 2018
The Grant Thornton International IFRS team has published IFRS Viewpoint – Accounting for client money.
The IFRS Viewpoint series provides insights on applying IFRS in challenging situations.
Each edition will focus on an area where the standards have proved difficult to apply or lack guidance.
This edition provides guidance on client money – arrangements in which a entity holds funds on behalf of clients.
The issue
Entities may hold money on behalf of clients under many different contractual arrangements, for example:
- a bank may hold money on deposit in a client’s bank account;
- a fund manager or stockbroker may hold money on behalf of a client as a trustee;
- an insurance broker may hold premiums paid by policyholders before passing them to an insurer;
- a lawyer or accountant may hold money on behalf of a client often held in a separate bank account where the interest earned is for the client’s benefit.
If an entity holds money on behalf of clients:
- should the client money be recognized as an asset in the entity’s financial statements?
- where the client money is recognized as an asset, can it be offset against the corresponding liability to the client in the statement of financial position?
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Download the document adviser-alert_ifrs-viewpoint_accounting-for-client-money-protected
October 2018 – IFRS Viewpoint Accounting for client money