Financial Modelling for IFRIC 12 Service Concessions

1 day duration

If your project falls under the scope of IFRIC 12 – Service Concession Arrangements it can be difficult to understand how this should be reflected in your financial model and how to approach the technical modelling requirements. 

This one day course will enable you to understand and implement core modelling techniques for service concessions to ensure that your models accurately reflect the complexity of the accounting.  You will focus on the best practice techniques for successfully implementing the technical requirements and gain an appreciation of the various rules and application of these to your project.

You will learn the modelling techniques of three key areas of IFRIC 12: financial asset, intangible asset & bifurcated.  Your instructor will guide you through the various considerations for each of these approaches and demonstrate key differences whilst showing the impact that adoption can have on key profiles such as profits & distributions. The course will also highlight the impact of IFRIC 12 in operational models and how to account for historic actuals in your concession accounting which is a key consideration for all asset managers with operational projects.

Key learnings

  • Learn best practice techniques for adopting IFRIC 12 Service Concession accounting into your financial models
  • Hands on model development led by our skilful trainers who will guide you through the steps needed to successfully implement IFRIC 12 using our expert case study model
  • Technical discussions on the key differences between financial assets, intangible assets and bifurcated assets and the rules & decision processes that will help you determine which should apply
  • Interactive modelling exercises to further cement your learning and demonstrate the nuanced features of IFRIC 12 such as solving for the interest rate, margins and dealing with quarterly interest calculations in a monthly model
  • Develop a deep understanding on how to implement IFRIC 12 in your operational models, how to incorporate historic actuals and make necessary adjustments to your balances or interest rate
  • Learn through graphical summaries & hands-on scenario analysis how the different accounting options will impact your model through key metrics & profiles such as profits & distributions

Is this programme for you?

This course is suitable for anyone who works with models that fall under IFRIC 12 – Service Concession Arrangements. Typical attendees would include Analysts, Managers, Senior Managers and Associate Directors.

Course prerequisites

The focus of this course is on financial modelling techniques and so is not a technical accounting course. It is therefore recommended that you have a high level understanding of IFRIC 12 Concession Arrangements before attending as this will help cement your understanding.  

We would highly recommend participants have some financial modelling experience & familiarity with best practice modelling. It would therefore be beneficial for participants to have attended our Best Practice Project Finance modelling course.


Course Agenda

Financial Modelling Techniques for IFRIC 12 Concession Accounting

  • Learn the key features of IFRIC 12 concession accounting and when & how this might apply to your projects
  • Detailed technical discussion around the different accounting approaches: financial asset, intangible asset or bifurcated and how these vary
  • Discuss the rule based flow process used to determine which accounting method should apply to your projects and how
  • Hands-on modelling experience in our case study model exploring the various accounting options, starting with fixed asset accounting to demonstrate how the differences from applying IFRIC 12
  • Develop an intangible asset account and learn how to implement into the key areas of your model and how to amortise over the life of the project
  • Gain a deep understanding of how to incorporate a financial asset in a model, including the choice of solving margin or effective interest
  • Learn how to use goal seek macros to aid in IFRIC 12 calculations as well as the application of IRR calculations to easily solve your financial asset interest rate
  • Develop your understanding on how to combine intangibles and financial assets in bifurcated accounting
  • Step through presentation of the impact of IFRIC 12 on your financial accounts and develop an understanding of where this appears on the profit and loss and balance sheet
  • Gain an understanding of how to incorporate IFRIC 12 in your operational models and to account for historic ‘actuals’ by solving or making adjustments to your balances or interest rates
  • Detailed scenario & graphical analysis with to identify and compare each accounting options and the impact that this has on key metrics and profiles in your project

Contact us to find out more