LACPA- IFRS Seminars
IAS 1
Presentation
of Financial
Statements
Presented by
– Roger Nasr,
Deloitte
DeloitteRoger Nasr
IAS 1
Structure of the standard
 Objective
and scope
 Purpose of Financial statements
 Components of Financial Statements
 Definitions
 Overall considerations
 Structure and content
DeloitteRoger Nasr
IAS 1
Objective and scope
 Objective


to prescribe basis for presentation of “General
Purpose” financial statements
in order to ensure comparability
 Scope

all general purpose financial statements
prepared under IFRS
• not condensed interim financial information
DeloitteRoger Nasr
Purpose of Financial statements
 Structured

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Presentation of
Financial Position
Financial Performance
Results of Management Stewardship of the
resources entrusted to it
DeloitteRoger Nasr
Components, complete set
of financial statements
IAS 1
 Balance
sheet
 Income statement
 Statement of changes in equity
 Cash flow statement
 Notes


Accounting policies
Explanatory notes
DeloitteRoger Nasr
Definitions

Impracticable requirement


IFRS


Entity can not apply it after making every reasonable
effort
IFRS, IAS, IFRIC or SIC
Material

Omission or misstatement is material if it can
influence the economic decision of users
DeloitteRoger Nasr
IAS 1
Overall considerations
 Fair

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
presentation
achieved through application of IFRS
disclose compliance with IFRS
full compliance with IFRS required
application before effective date
• disclose that fact

true and fair override
• only in extremely rare circumstances
DeloitteRoger Nasr
IAS 1

Overall considerations
Fair presentation



In extremely rare circumstances, where compliance
with a Standard would be misleading so it would
conflict with objective set out in the framework
departure is permissible, if regulatory framework
requires or does not prohibit
Specified disclosure required
DeloitteRoger Nasr
IAS 1

Overall considerations
Going concern
• no intention to liquidate or to cease trading
• Disclose in case of Material uncertainty

Accrual basis - transactions and events
• are recognised when they occur, and
• in the periods to which they relate

Consistency
• presentation & classification be retained


Unless change in nature of operations necessitates another
presentation
A standard or an interpretation requires a change
DeloitteRoger Nasr
IAS 1
Overall considerations
Materiality & aggregation
• material  present separately
• immaterial  aggregate with other items
 Offsetting
• Assets/Liabilities, and Income and expenses shall not be offset
unless required or permitted
 Comparative
information
• incl. narrative & descriptive information
DeloitteRoger Nasr
IAS 1

Structure and content
General

identification of financial statements
• clearly distinguished from other information

reporting period
• at least annually,
• to explain if longer or shorter

Information required
•
•
•
•
•
Name and change, if any
Individual or group financials
Period covered
Currency
Level of rounding
DeloitteRoger Nasr
IAS 1
Structure and content
 Balance




sheet
current vs. non-current distinction
or, classify based on liquidity if more relevant
obligatory line items on face of B/S
disclosure required on face or in notes
• relevant sub-classifications of items above
• information on share capital and reserves
DeloitteRoger Nasr
Structure and content

Minimum Items on face of Balance Sheet

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Property, Plant and Equipment
Investment Property
Intangible Assets
Financial Assets
Investments Accounted for using the equity method
Biological Assets
Inventories
Trade and Other receivables
Cash and Cash Equivalents
Trade and Other Payables
Provisions
Financial liabilities
Liabilities and Assets for current tax
Deferred tax assets and liabilities
Minority interest within equity
Issued Capital and reserves attributable to equity holders of the parent
DeloitteRoger Nasr
IAS 1
Structure and content
 Current




vs. non-current Assets
Realised/settled in the normal course of
operating cycle or within 12 month of the
balance sheet date
Held primarily for the purpose of being traded
Unrestricted cash or a cash equivalent
All other assets are non-Current
DeloitteRoger Nasr
Structure and content

Current Vs. non Current Liabilities

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Settled in the normal course of operating cycle or due to be
settled within 12 month of the balance sheet date
Held primarily for the purpose of being traded
No unconditional right to defer settlement for at least 12 months
post-balance sheet events (refinancing, correction of defaults) do
not affect current vs. non-current classification
All other Liabilities are non-Current
DeloitteRoger Nasr
IAS 1

Structure and content
Income statement


obligatory line items on face of I/S
To show as allocation
• Profit or loss attributable to Minority Interest
• Profit or loss attributable to equity holders of the parent

expenses analysed on basis of
• nature
• Function

Dividends should be disclosed plus per share (or in statement
of changes in equity
DeloitteRoger Nasr
Structure and content

Minimum Items on the face of the income statement

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Revenue
Finance Costs
Share of profit/loss of associates accounted for at the equity method
Tax expense
Sum of profit or loss on discontinued operations plus gain or loss on the
disposal of discontinued operations assets
Profit or loss
No operating income/loss
No extraordinary items
DeloitteRoger Nasr
IAS 1
Structure and content
 Income

Statement presentation
classification based on nature
• salaries, depreciation, transport, etc

classification based on function
• cost of sales, distribution, administration
DeloitteRoger Nasr
IAS 1
Structure and content
 Statement


of changes in equity
separate component of financial statements
On the face
• (a) Profit or loss for the period
• (b) gains and losses not reflected in income statement
• (a)+(b) attributable to each of Minority Interest and equity holders
of the parent

also in statement or in the notes
• capital transactions with owners
• movements in accumulated profit
• movements in capital and reserves
DeloitteRoger Nasr
IAS 1
 Role

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
Structure and content
of statement of changes in equity
broader performance indicator
‘total recognised gains and losses’ or
‘comprehensive income’
 Cash
flow statement in accordance with
IAS 7
DeloitteRoger Nasr
IAS 1
Structure and content
 Notes

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to the financial statements
basis of preparation of financial statements
accounting policies selected
additional disclosure to present fairly
other sundry disclosures
• e.g. domicile, legal form, country of incorporation
DeloitteRoger Nasr
IAS 1
 Case

study 01
Income statement presentation
DeloitteRoger Nasr
Classification by function
DeloitteRoger Nasr
DeloitteRoger Nasr