Investor Presentaiton
HKAS 1.51(a)
HKAS 1.49
HK Listco Ltd
Financial statements for the year ended 31 December 2023
HKFRS 15.105,
HKAS 1.60, 66,
69
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HKFRS 15.109
HKFRS 15 does not specify whether entities are required to present their contract assets and contract liabilities as separate line
items or how to classify them as current or non-current in the statement of financial position. Entities should therefore apply the
general principles in HKAS 1 for presenting and classifying contract assets and contract liabilities.
In determining whether to classify the entire item as current or non-current or split into current and non-current component, an
entity should consider the nature of its contract assets and contract liabilities and applies the guidance for similar assets or
liabilities. For example, if contract assets are considered similar in nature to trade receivables, then it may be appropriate to split
into current and non-current components. If contract liabilities are considered similar in nature to other operating liabilities, then
it may be appropriate to classify the entire balance as current; whereas if they are similar in nature to long-term borrowings, then
the balance should be split into current and non-current components.
In this illustration, HK Listco determines that contract assets and contract liabilities are sufficiently material to be presented
separately. In addition, as it expects these amounts to be realised or settled within its normal operating cycle, it presents them as
current in the statement of financial position.
HK Listco uses the terms "contract assets" and "contract liabilities" as these are used in HKFRS 15. However, entities are not
prohibited from using alternative terms to describe these items in their statements of financial position, provided that the entities
give sufficient information to users to distinguish these amounts from receivables and payables, which are different in nature.
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