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International Financial Reporting Standards

Case 1 - IAS 1

Apple vs BMW
Case 1 Presentation of Financial Reports | IAS 1

Question 1.2

This question is about comparing the two Annual Reports of the year 2014 from BMW and Apple Inc.
The first company, BMW, is an automobile company located in Germany and the latter one is a technological
company located in the US. Therefore, the financial statements of BMW follows the rules and standards of
IFRS and Apple Inc. applies the US GAAP.
The annual reports, which were used to answer the question, were downloaded from Apples
webpage (investors relation) and BMWs Annual Report was available on the Moodle platform.
In the following table, we compare the two annual reports for both companies, focusing on Annual
Report Structure, Group Financial Statements and Format/Layout.

Question 1.3

According to IAS 1

The main objective of IAS1 is to ensure comparability, prescribing the basis of presentation for financial
position, financial performance and cash flow of an entity.
Therefore, in order to meet that objective, every entity must provide information about their:
- Assets;
- Liabilities;
- Equity;
- Income and expenses (Gains and Losses);
- Contribution by and distributions to owners;
- Cash flow.
First, we tried to identify whether the final report fulfill a complete set of financial statements or not and we
clearly identified all the required statements. Within this set of statements we found:
- Statement of financial position (Balance sheet);
- Statement of Profit and loss and other comprehensive income for the period;
- Statement of changes in equity for the period;
- Statement of cash flow for the period;
- Explanatory Notes;
- Comparative information.
By observing BMW financial statements we saw a consistent presentation along the years, provided comparative
information from the previous years and also used an accrual basis accounting policy.
Regarding BMW Final Report structure and content, they clearly distinguish their financial statements from
other information, it contains explanatory notes and the information is displayed prominently. This is, identifies the
reported entity, distinguishes whether the financial statement is about a group or individual entity, give us the
information about the reported period, currency and level of rounding used.
According to the financial position statement, it fulfills the IAS1 requirement where it separates Current from
Non-Current assets and liabilities. The line items to be included in the financial position, regarding IAS1.54 are:

Line Items BMW

Property, Plan & Equipment

Investment Property X

Intangible Assets

Financial Assets

Investment Accounted for using the equity method

Biological Assets X


Trade and other receivables

Cash and cash equivalents

Assets held for sale

Trade and other payables


Financial Liabilities

Current tax liabilities and current taxes

Deferred tax liabilities and deferred tax assets

Liabilities included in disposal groups

Non-controlling interests, presented within equity

Issued capital and reserves attributable to owners of the parent

Finally, regarding the statement of profit or loss and other comprehensive items BMW fulfill all the requirements
IAS1.81A, this is:
- Profit or Loss;
- Total other comprehensive income;
- Comprehensive income for the period;
- Allocation of profit or loss and comprehensive income for the period between non-controlling interests and
owners of parent.
BMW profit and losses statement is presented by function and contains all required minimum line items.

Line Items BMW


Gains and Losses From derecongnition of financial assets measured at

amortized cost.

Finance costs.

Share of profit or loss of associates and joint venture accounted for using
the equity method.

Certain gains or losses associated with the reclassification of financial


Tax expense

Single amount for the total of discontinued items.