IFRIC 12 Service Concession Arrangements is an Interpretation issued by the IFRS Interpretations Committee (formerly IFRIC) that has a very significant impact on the financial reporting of any company that enters a concession arrangement with the government.

A service concession arrangement is an arrangement whereby a government or other public sector body contracts with a private operator to develop (or upgrade), operate, and maintain the grantor’s infrastructure assets such as roads, bridges, tunnels, airports, energy distribution networks, prisons, or hospitals.

IFRIC 12 draws a distinction between two types of service concession arrangements.
• Financial Asset Model
• Intangible Asset Model

The IFRIC 12 accounting module provides greater insight to:
1. Define Service Concession Arrangement
2. Types of Services Concession Arrangements
3. Accounting of Financial Asset Model
4. Accounting of Intangible Asset Model
5. Generates conventional and IFRIC 12 financial statements (P&L, balance sheet, and cash flows) for a project and analyzes the differences in headline financial items.
6. Demonstrates accounting methodology used under IFRIC 12

This module includes:
1. Excel-based financial model
2. Macro Word Document – This includes the VBA Code used in the model for the user’s reference
3. Basic IFRIC 12 Guide

Technical Specifications:

1. The model uses Macros (VBA) to calculate the effective interest rate to wind down the financial asset receivable toward the end of the concession. To run the model optimally, keep macros enabled. In case you do not like Macros, you could manually disable or remove the Macros and will have to rework the model’s logic to be used without Macros but it is not recommended by the author.

2. The model is built using Microsoft Excel 2019 version for Windows. Please note, on certain Mac laptops or MS Excel prior to 2007, Excel with Macros can slow down your computer if your PC does not have enough processing power.

3. We advise not to delete or insert rows and columns into the model if you are not aware of the model structure as it can distort model functioning. If you need assistance with customizing the model template, the author is more than willing to help you. Simply contact us at pushkarkumar@fin-wiser.com and send your model template as well as specifications. We will then get back to you with a quotation for the customization service (billable hours & completion date).