IAS 1 Presentation of Financial Statements
Overall
Considerations
1. Fair
presentation and compliance with IFRSs
Financial
statements are required to be presented fairly as set out in the framework and
in accordance with IFRS and are required to comply with all requirements of
IFRSs.
2. Going
concern
Financial
statements are required to be prepared on a going concern basis (unless entity
is in liquidation or has ceased trading or there is an indication that the
entity is not a going concern).
3. Accrual
basis of accounting
Entities
are required to use accrual basis of accounting except for cash flow
information.
4. Presentation
consistency
An
entity is required to retain presentation and classification from one period to
the next.
5. Materiality
and aggregation
Each
material class of similar assets and items of dissimilar nature or function is
to be presented separately.
6. Offsetting
Offsetting
of assets and liabilities or income and expenses is not permitted unless
required by other IFRSs.
7. Comparative
information
At
least 1 year of comparative information (unless impractical).
Components of
Financial Statements
A complete set of financial statements comprises:
·
Statement of
financial position
· Statement of
comprehensive income or an income statement and statement of comprehensive income
·
Statement of
changes in equity
·
Statement of
cash flows
·
Notes.
All statements are required to be presented with equal prominence.
Structure and Content
Identification of the financial statements
Financial statements must be
clearly identified and distinguished from other information in the same
published document, and must identify:
·
Name of the reporting entity
·
Whether the financial statements cover the
individual entity or a group of entities
·
The statement of financial position date (or
the period covered)
·
The presentation currency
·
The level of rounding used.
Reporting Period
·
Accounts presented at least annually
·
If longer or shorter, entity must disclose
that fact.
Statement of
Financial Position
·
Present current and non-current items
separately; or
·
Present items in order of liquidity
Current assets
· Expected to be realized in, or is intended
for sale or consumption in the entity’s
n operating cycle
·
Held primarily for trading
·
Expected to be realized within 12 months
·
Cash or cash equivalents.
All other assets are
required to be classified as non-current.
Current liabilities
·
Expected to be settled in the entity’s no
operating cycle
·
Held primarily for trading
·
Due to be settled within 12 months
· The entity does not have an unconditional
right to defer settlement of the liability for at least 12 months.
All other liabilities are
required to be classified as non-current.
Statement of
Comprehensive Income
·
An entity presents all items of income and
expense recognized in a period, either:
o
In a single statement of comprehensive income
o
In two statements: a statement displaying
components of profit or loss (separate income statement) and a second statement
of other comprehensive income.
·
Information required to be presented in the:
o
Statement of comprehensive income is defined
in IAS 1.82 - 87
o
Profit or loss as defined in IAS 1.88
o
Other comprehensive income in IAS 1.90-96.
o Further information required to be presented
on the face or in the notes to the Statement of Comprehensive Income is
detailed in IAS 1.97
· Entities must choose between ‘function of
expense method’ and ‘nature of expense method’ to present expense items
· Line items within other comprehensive income
are required to be categorized into two categories:
o
Those that could subsequently be reclassified
to profit or loss
o
Those that cannot be re-classified to profit
or loss.
Statement of
Changes in Equity
Information required to be
presented:
· Total comprehensive income for the period,
showing separately attributable to owners or the parent and non-controlling
interest
· For each component of equity, the effects of
retrospective application/restatement recognized in accordance with IAS 8 Accounting
Policies, Changes in Accounting Estimates and Errors
· The amounts of transactions with owners in
their capacity as owners, showing separately contributions by and distributions
to owners
· For each component in equity a reconciliation
between the carrying amount at the beginning and end of the period, separately
disclosing each change
· Amount of dividends recognized as
distributions to owners during the period (can alternatively be disclosed in
the notes)
·
Analysis of each item of OCI (alternatively
to be disclosed in the notes).
Statement of Cash
Flows
·
Provides users of financial statements with
cash flow information – refer IAS 7 Statement of Cash Flows.
Notes to the
Financial Statements
·
Statement of compliance with IFRSs
·
Significant accounting policies, estimates,
assumptions, and judgments must be disclosed
·
Additional information useful to users
understanding/ decision making to be presented
·
Information that enables users to evaluate
the entity’s objectives, policies and processes for managing capital.
Third Statement of
Financial Position
The improvement clarifies in
regard to a third statement of financial position required when an entity
changes accounting policies, or makes retrospective restatements or
reclassifications:
· Opening statement is only required if impact
is material
· Opening statement is presented as at the
beginning of the immediately preceding comparative period required by IAS 1
(e.g. if an entity has a reporting date of 31 December 2012 statement of
financial position, this will be as at 1 January 2011)
· Only include notes for the third period
relating to the change.
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