Royal Dutch Shell

Royal Dutch Shell PLC Monitor

Royal Dutch Shell PLC Annual Report 2017
CR Monitor Issue: 
2018/0808
Company covered: 
Royal Dutch Shell PLC
Period End: 
31 December, 2017
Report issued on 14 August 2018 covered the following practice issues:
Pronouncements
Extended disclosure in respect of the future impacts of IFRS 9 "Leases", IFRS 15 "Revenues from contracts with customers" and IFRS 16 "Leases".
Change
Extended disclosure of key audit matters in the audit report.
Change
Format of strategic report disclosure of key performance indicators altered
Change
Fair value of 50% joint venture stake represents value of consideration paid in business combination.
Restatement
Restatement of segment geographical entity wide disclosures.

Royal Dutch Shell PLC Monitor

Royal Dutch Shell PLC Annual Report 2016
CR Monitor Issue: 
2017/1107
Company covered: 
Royal Dutch Shell PLC
Period End: 
31 December, 2016
Report issued on 21 November 2017 covered the following practice issues:
Change
Change in segment reporting following an alteration to the business management structure.
Change
Financial instrument risk disclosures extended to include a value at risk analysis in respect of carbon emission rights trading.
Restatement
Restatement of amounts offset in respect of derivative contracts to align with a new netting methodology applied this year.
Change
Auditors include discussion of key audit matters in their report instead of areas of focus.
Divergence
No qualitative disclosure as to what goodwill recognised on a business acquisition represents.
Restatement
Restatement of statement of changes in equity in relation to shares held in trust.

Fair value measurement information under IFRS

IFRS 13 “Fair value measurement” sets out a single consistent framework for measuring fair value within IFRS financial statements and outlines a standardised set of disclosures in respect of fair value measurements. IFRS 13 has been mandatory now for some years, with application being required for annual reporting periods beginning on or after 1 January 2013. This report sets out the results of how requirements of the standard have been put into practice, both in terms of measurement and disclosure, in the consolidated financial statements of 139 large public limited companies with year ends between 31 March 2016 and 1 April 2017. It is not an exhaustive study of all aspects of IFRS 13 application and its conclusions are limited to our findings in respect of the areas analysed within the financial statements reviewed.

Disclosure of the impacts of IFRS 16 "Leases"

IFRS 16 “Leases” will fundamentally change accounting by lessees as it requires assets previously off balance sheet under operating lease arrangements to be brought on balance sheet as is currently the case for finance leased assets. As a result on application companies will recognise both additional assets and additional liabilities. Consequently there will also be knock on effects in the income statement as operating lease charges are replaced by a depreciation charge and a finance expense. This report analyses the financial statements of a range of companies to firstly establish whether there has been any early adoption and secondly to establish what companies are disclosing in respect of IFRS 16 and its future impacts.

Joint Arrangements: An emerging issue under IFRS

This report focuses on the financial reporting by entities that have an interest in arrangements which are controlled jointly with another party, in light of the requirements of IFRS 11 “Joint arrangements”. It covers company application of the concept of joint control taking into account the guidance given by IFRS to companies to determine whether arrangements fall within the scope of IFRS 11. It further covers the review undertaken by companies based on the rights and obligations held to determine whether the joint arrangements that exist are considered joint ventures or joint operations and the subsequent accounting of such arrangements in line with the equity accounting method as per IAS 28 “Investments in associates and joint ventures” or of the entities proportionate share of assets, liabilities, revenue and expenses respectively. Finally it considers the financial and presentational impacts of IFRS 11 adoption.