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SEMINAR ON IFRS by

SEMINAR ON IFRS by. THE INSTITUTE OF COMPANY SECRETARIES OF INDIA WITH RELIANCE COMMUNICATIONS & WIRC ICWAI. 22 nd AUGUST 2009. THRU 50+ CITIES AND 75+ RELIANCE VIDEO CONF LOCATIONS SPEAKER : Rammohan Bhave, CS, ICWA, CA mohanbhave@gmail.com Dr Mrs Anjali Bhave, ICWA, Ph.D.

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SEMINAR ON IFRS by

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  1. SEMINAR ON IFRSby THE INSTITUTE OF COMPANY SECRETARIES OF INDIA WITH RELIANCE COMMUNICATIONS & WIRC ICWAI

  2. 22nd AUGUST 2009 • THRU 50+ CITIES • AND 75+ RELIANCE VIDEO CONF • LOCATIONS • SPEAKER : • Rammohan Bhave, CS, ICWA, CA • mohanbhave@gmail.com • Dr Mrs Anjali Bhave, ICWA, Ph.D.

  3. IAS 1 Presentation of Financial Statements RammohanBhave & Dr AnjaliBhave mohanbhave@gmail.comarbhave@gmail.com +91 9004043365, +91 9322249029 +91 9322249029

  4. IFRS Based Financial Statements • IAS -1 “ Presentation of Financial Statements” is a foundation standard that explains basic accounting and financial reporting principles and style of presentation.

  5. IFRS Based Financial Statements A complete set of Financial Statements comprise of • A Statement of Financial Position as at the end of the year; • A Statement of Comprehensive Income for the period; • A Statement of Changes in Equity for the period; • A Statement of Cash Flows for the period; • Notes comprising of a summary of significant accounting policies and other explanatory information ; • A statement of financial position as at the beginning of the earliest comparative period when an entity applies an accounting policy retrospectively or makes a retrospective restatement of items in its financial statements, or when it reclassifies items in its financial statements. [ Para 10, IAS-1]

  6. Minimum Line Items to be Presented in Statement of Financial Position ( Reference Para 54 of IAS 1

  7. Minimum Line Items to be Presented in Statement of Financial Position ( Reference Para 54 of IAS 1

  8. Current Assets • Current assets should have any of the following characteristics: • These are expected to be realised within the normal operating cycle of the entity or within twelve months after the balance sheet date whichever is higher ; examples are receivables, , advances, loans , etc. Financial instruments like available for sale , held to maturity and loans which will be realised within a period of twelve months from the date of balance sheet date. • These are intended for sale or consumption within the normal operating cycle of the entity; example inventories. • These are held primarily for the purpose of trading ; example Held for Trading Financial Instruments. • These are cash and cash equivalents. As per IAS-7 cash comprises of cash on hand and demand deposits. Cash equivalents are highly liquid investments that are readily convertible to known amounts of cash , and which are subjected to insignificant risk of changes in value.

  9. Current Liabilities • Liabilities are classified as current liabilities if these satisfy any of the following criteria: • These are expected to be settled in the entity’s normal operating cycle. • These are primarily held for trading. • These are due to be settled within a period of twelve months from the balance sheet date. • The entity does not have an unconditional right to defer settlement of the liability for at least twelve months after the balance sheet date. • All other liabilities are classified as non-current liabilities.

  10. Statement of Comprehensive Income • Two-part Statement of Comprehensive Income • First part presents Statement of Income • Second part presents Statement of Other Comprehensive Income • Two Separate Statements • Statement of Other Comprehensive Income presents certain items of unrealised gain / loss to be directly accounted for in the equity. This statement intends to present the periodic effect.

  11. Statement of Income • There are two distinct presentation styles of the Statement of Income • income statement portion can be either presented by nature of expense or function .

  12. Classification of Expenses by Nature

  13. Classification of Expenses by Nature

  14. Classification of Expenses by Functions

  15. Classification of Expenses by Functions

  16. Statement of Other Comprehensive Income

  17. Statement of Other Comprehensive Income

  18. Information to be presented on the face of the Income Statement ( or Income Statement portion of the Statement of Comprehensive Income) or in the Note

  19. Statement of Changes in Equity • Paras 106-110 of IAS 1 set out the principles for presentation of Statement of Changes in Equity . This statement is meant for depicting the movement in equity during the accounting period. This statement reflects – • Various components of the equity with separate presentation of non-controlling interest ; • Distribution of total comprehensive income during the year to various equity components and non-controlling interest ; • Distribution to owners by way of dividend and other transaction with owners like issue of shares.

  20. Statement of Changes in Equity • This statement makes reconciliation of balances of various equity components at the beginning and end of the accounting period. Para 107 of IAS 1 particularly requires disclosures of dividend recognised and distributed either in the Statement of Changes in Equity or in Notes along with per share information.

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