Prescribes the basis for presenting general-purpose financial statements.
Ensures comparability both with the entity's own statements from previous periods and with the statements of other entities.
IAS 1 sets out the overall requirements for the presentation, structure, and minimum content of financial statements prepared under IFRS.
Applies to all general-purpose financial statements prepared and presented in accordance with International Financial Reporting Standards (IFRS).
General purpose means intended for users who cannot require reports tailored to their specific information needs.
Does not apply to the structure and content of condensed interim financial statements prepared under IAS 34 *Interim Financial Reporting*.
Components (Minimum Required):
Statement of financial position (as at the end of the period).
Statement of profit or loss and other comprehensive income (for the period).
Statement of changes in equity (for the period).
Statement of cash flows (for the period - detailed in IAS 7).
Notes, comprising significant accounting policies and other explanatory information.
Comparative information in respect of the preceding period for all amounts presented.
Statement of financial position as at the beginning of the preceding period (an "opening" or "third" balance sheet) if an entity applies an accounting policy retrospectively, makes a retrospective restatement, or reclassifies items.
Fair Presentation & Compliance with IFRS
Financial statements must present fairly the financial position, financial performance, and cash flows. Fair presentation requires faithful representation.
Must make an explicit and unreserved statement of compliance with IFRS in the notes if they comply with all requirements.
Compliance with IFRS is presumed to result in fair presentation.
Going Concern
Management must assess the entity's ability to continue as a going concern (considering events at least, but not limited to, 12 months from the reporting date).
If material uncertainties exist casting significant doubt on going concern ability, these must be disclosed.
If statements are not prepared on a going concern basis, this fact must be disclosed, along with the basis used and the reason why the entity is not considered a going concern.
Accrual Basis of Accounting
Prepare financial statements using the accrual basis, except for cash flow information.
Transactions are recognised when they occur, not when cash is received or paid.
Materiality & Aggregation
Each material class of similar items must be presented separately.
Items of a dissimilar nature or function must be presented separately unless they are immaterial.
Information should not be obscured by aggregating material items with dissimilar natures or by including immaterial details. Materiality depends on size and nature, judged in the surrounding circumstances.
Consistency of Presentation
Retain the presentation and classification of items from one period to the next unless:
A significant change in the nature of operations or a review indicates different presentation is more appropriate; or
An IFRS standard requires a change in presentation.
Offsetting
Assets and liabilities, and income and expenses, should not be offset unless required or permitted by an IFRS.
Offsetting detracts from users' ability to understand transactions and assess future cash flows. Measuring assets net of valuation allowances (e.g., inventory obsolescence, doubtful receivables) is not offsetting.
Key Requirements:
Must present assets and liabilities classified as current and non-current, unless a presentation based on liquidity provides more relevant and reliable information (rare, e.g., for some financial institutions).
Minimum Line Items:
| Category | Examples of Minimum Line Items |
| Assets | Property, plant and equipment (PPE); Investment property; Intangible assets; Financial assets (excluding cash, receivables); Investments accounted for using equity method; Biological assets; Inventories; Trade and other receivables; Cash and cash equivalents; Assets held for sale (IFRS 5). |
| Equity | Issued capital and reserves attributable to owners of the parent; Non-controlling interests (NCI). |
| Liabilities | Financial liabilities (excluding payables, provisions); Trade and other payables; Provisions; Current tax liabilities/assets; Deferred tax liabilities/assets; Liabilities included in disposal groups (IFRS 5). |
Additional lines, headings, and subtotals should be presented if relevant to understanding financial position.
Current/Non-current Distinction Criteria:
| Classification | Criteria |
| Current Asset |
An asset is current if it is:
Expected to be realised, sold, or consumed in the normal operating cycle; or
Held primarily for trading; or
Expected to be realised within 12 months after the reporting period; or
Is cash or cash equivalent (unless restricted for 12+ months).
All other assets are non-current.
|
| Current Liability |
A liability is current if it is:
Expected to be settled in the normal operating cycle; or
Held primarily for trading; or
Due to be settled within 12 months after the reporting period; or
The entity does not have an unconditional right to defer settlement for at least 12 months.
All other liabilities are non-current.
|
The operating cycle is the time between acquiring assets for processing and their realisation in cash. If not clearly identifiable, it's assumed to be 12 months.
Presentation Options:
Option 1: Present a single statement of profit or loss and other comprehensive income.
Option 2: Present two statements: a separate statement displaying components of profit or loss (P&L), immediately followed by a statement beginning with P&L and displaying components of other comprehensive income (OCI).
Profit or Loss Section Must Include (Minimum):
Revenue (disaggregated per IFRS 15).
Share of the profit or loss of associates and joint ventures accounted for using the equity method.
A single amount for the total of discontinued operations (post-tax profit/loss and post-tax gain/loss on disposal - IFRS 5).
Profit or loss for the period attributable to non-controlling interests and owners of the parent.
Expenses should be presented based on either their nature or their function (e.g., cost of sales method), whichever provides more reliable and relevant information. Disclosure of nature is required if function method used.
Other Comprehensive Income (OCI) Section Must Be Split:
| OCI Type | Nature & Examples |
| Items that will be reclassified subsequently to P&L |
Amounts recognized in OCI in the current period that may be recycled ("reclassified") to profit or loss in future periods when specific conditions are met.
Gains/losses on cash flow hedges
Foreign currency translation differences on foreign operations
Changes in value of debt instruments measured at FVOCI (IFRS 9)
|
| Items that will not be reclassified to P&L |
Amounts recognized in OCI that will remain in equity and will not be recycled to profit or loss in future periods.
Changes in revaluation surplus (IAS 16/IAS 38)
Remeasurements of defined benefit plans (actuarial gains/losses - IAS 19)
Changes in value of equity instruments designated at FVOCI (IFRS 9)
|
Income tax relating to each component of OCI must be disclosed, either in the statement or in the notes. OCI items are presented net of tax, or before tax with the aggregate tax shown separately.
Total comprehensive income for the period attributable to non-controlling interests and owners of the parent must also be shown.
Must show a reconciliation between the carrying amount at the beginning and the end of the period for each component of equity, separately disclosing changes resulting from:
Profit or loss for the period.
Other comprehensive income (showing each item).
Total comprehensive income for the period (P&L + OCI), showing amounts attributable to owners of the parent and to NCI.
For each component of equity, the effects of retrospective application or restatement recognized under IAS 8.
Transactions with owners in their capacity as owners, showing separately contributions by and distributions to owners (e.g., share issues, dividends).
Analysis of OCI by item and reconciliation of changes in accumulated OCI can be presented either in the statement or in the notes.
Provide narrative descriptions or disaggregations of items presented in the primary statements and information about items that do not qualify for recognition.
Structure (Systematic Manner - Suggested Order):
Statement of compliance with IFRS.
Summary of significant accounting policies applied.
Supporting information for items presented in the primary statements, in the order in which each statement and line item is presented.
Other disclosures, including:
Contingent liabilities (IAS 37) and unrecognized contractual commitments.
Non-financial disclosures (e.g., risk management objectives - IFRS 7).
Key Accounting Policy & Estimation Disclosures:
Judgments made by management (apart from estimations) in applying accounting policies that have the most significant effect on recognized amounts (e.g., classifying leases).
Information about key assumptions concerning the future, and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to carrying amounts within the next financial year.
Information enabling users to evaluate the entity's objectives, policies and processes for managing capital.
Minimum requirement: Present comparative information for the preceding period for all amounts reported in the current period's financial statements.
Include comparative information for narrative and descriptive information if relevant to understanding the current period's statements.
If amounts are restated or reclassified:
Present a third statement of financial position as at the beginning of the preceding period (unless impracticable).
Disclose the nature, amount of each item affected, and reason for the restatement/reclassification in the notes.
If retrospective restatement is impracticable for a particular prior period, disclose the circumstances and describe how the correction has been made.
Identification & General Information:
Clearly identify each financial statement and the notes.
Prominently display: Name of reporting entity, whether statements cover individual entity or group, reporting date or period covered, presentation currency (IAS 21), level of rounding used.
Reclassification Adjustments:
Amounts reclassified to profit or loss in the current period that were previously recognized in OCI (e.g., on disposal of a foreign operation, derecognition of cash flow hedges).
These adjustments must be disclosed, either in the statement of P&L and OCI or in the notes.
Disclosure of Restatement/Reclassification:
When presentation or classification is amended, disclose (unless impracticable): Nature of the reclassification, amount of each item reclassified, and the reason.
Ensure a clear, understandable structure and use language accessible to users.
Avoid cluttering financial statements with immaterial information.
Disaggregate material items appropriately to provide relevant information.
Ensure consistency in terminology and headings used throughout the statements and notes.
Clearly identify amounts attributable to non-controlling interests (NCI) versus owners of the parent in equity and total comprehensive income.
Provide specific accounting policies for material transactions/balances, not just boilerplate text.
