IAS 1 – PRESENTATION OF FINANCIAL STATEMENTS

Apply = General Purpose FS = Consolidated FS = Separate FS

Terminology = Profit-oriented entities = Amend if used for non-profit oriented entities / mutual funds

General purpose FS = Intended to meet the needs of all users

IFRS = IFRS + IAS + IFRIC + SIC

Purpose of Financial Statements

Information about elements of FS i.e., Assets, Liabilities, Equity, Income & Expenses

Complete set of Financial statements

FS = SFP + SCI + SCE + SCF + Notes + Comparative information + Opening SFP as per IAS 8

SCI = P&L + OCI

General Features

1. Elements of FS must be presented as per definition and recognition set out in Framework
2. Statement about compliance with IFRSs is mandatory
3. Disclosure of inappropriate accounting policy not enough
4. Departure from compliance with IFRSs only if compliance would be misleading
5. Going concern basis = Management intention to liquidate + cease trading + Financial distress
6. Accrual basis of accounting
7. Present separately dissimilar items unless immaterial
8. Offsetting not allowed unless required by an IFRS
9. Frequency of Reporting = Annually
10. Comparative information = Current period + Preceding period
(In case of change in accounting policy as per IAS 8 = SFP as at the End of the (Current + Preceding
period) + beginning of preceding period)
11. Reclassification is allowed only if = More reliable & relevant information + required by an IFRS

Structure and Content

Identification of the financial statements = Name + Date + Individual/Consolidated + Currency +

Rounding off

Statement of financial position

Presentation = Nature & Liquidity basis OR Function basis + Non-current < 12 months + Current > 12
months

Statement of comprehensive income

Total Comprehensive Income = Net profit/loss + Other Comprehensive Income

Presentation = Nature OR Function basis

In case of consolidated = Profit attributable to NCI & Parent + TCI attributable to NCI & Parent

Statement of changes in equity

SCE = Share capital + Reserves + TCI

In case of consolidated = Share capital + Reserves + Parent TCI + NCI

Statement of Cash flows

As per IAS 7

Notes

Notes = Accounting policies + Information not presented elsewhere + Any additional information

Accounting policies = Measurement basis + any relevant policies

Sources of estimate uncertainty = Assumptions + other major sources

Capital Management = Objectives + Policies + Processes

Proposed dividend = Disclosure

ILLUSTRATIVE PRESENTATION

Please go through the PART B of IFRS Red Book

PAST PAPER ANALYSIS

IAS 1 is being tested in each and every attempt in the form of following:

1. Consolidated Financial Statements

2. Separate Financial Statements
3. Questions requiring extract of SFP and SCI