1. SEMINAR ON IFRS by 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
Dr Mrs Anjali Bhave, ICWA, Ph.D.

3. IAS 1 Presentation of Financial Statements
Rammohan Bhave & Dr Anjali Bhave ,

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. Structure of Statement of Financial Position
2009
2008
ASSETS
Non-current Assets
Property , Plant & Equipment
Goodwill
Other Intangible Assets
Investments in Associates
Available for Sale Investments
Current Assets
Inventories
Trade Receivables
Other Current Assets
Cash & Cash Equivalents
Total Assets

7. Structure of Statement of Financial Position
2009
2008
EQUITY AND LIABILITIES
Equity attributable to the owners of the parent
Share Capital
Retained Earnings
Other components of Equity
Non-controlling Interest
Total Equity

8. Non-current Liabilities
Long-term borrowings
Deferred tax
Long term provisions
Total non-current liabilities
Current Liabilities
Trade and other payables
Short-term borrowings
Current portion of long- term borrowings
Current tax payable
Short-term provisions
Total current liabilities
Total liabilities

9. Minimum Line Items to be Presented in Statement of Financial Position ( Reference Para 54 of IAS 1
Property, plant and equipment;
(b)
Investment property;
(c)
Intangible assets;
(d)
Financial assets (excluding amounts shown under (e), (h) and (i));
(e)
Investments accounted for using the equity method;
(f)
Biological assets;
(g)
Inventories;

10. Minimum Line Items to be Presented in Statement of Financial Position ( Reference Para 54 of IAS 1
(h)
Trade and other receivables;
(i)
Cash and cash equivalents;
(j)
The total of assets classified as held for sale and assets included in disposal groups classified as held for sale in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations;
(k)
Trade and other payables;
(l)
Provisions;
(m)
Financial liabilities (excluding amounts shown under (k) and (l));
(n)
Liabilities and assets for current tax, as defined in IAS 12 Income Taxes;
(o)
Deferred tax liabilities and deferred tax assets, as defined in IAS 12;
(p)
Liabilities included in disposal groups classified as held for sale in accordance with IFRS 5;
(q)
Non-controlling interests, presented within equity; and
(r)
Issued capital and reserves attributable to owners of the parent.

11. 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.

12. 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.

13. 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.

14. 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 .

15. Classification of Expenses by Nature
Income Statement
2009
2008
Revenue
Other Income
Changes in inventories of finished goods and work in progress
Work performed by the entity and capitalised
Raw material consumed
Employee Benefit Expenses
Depreciation and Amortisation Expenses
Impairment of Property , Plant and Equipment and Intangible Assets
Other Expenses
Finance Costs
Share of profit of associates

16. Classification of Expenses by Nature
Income Statement
2009
2008
Profit Before Tax
Income tax expense
Profit for the year from continuing operations
Profit ( Loss) for the year from discontinued operations
Profit for the year
Profit attributable to :
Owners of the entity
Non-controlling interest
Earning per share
Basic
Diluted

17. Classification of Expenses by Functions
2009
2008
Revenue
Cost of sales
Gross Profit
Other Income
Distribution Costs
Administrative Expenses
Other Expenses
Finance Costs
Share of profit of associates

18. Classification of Expenses by Functions
2009
2008
Profit Before Tax
Income tax expense
Profit for the year from continuing operations
Profit ( Loss) for the year from discontinued operations
Profit for the year
Profit attributable to :
Owners of the entity
Non-controlling interest
Total Comprehensive Income attributable to :
Earning per share4
Basic
Diluted

19. Statement of Other Comprehensive Income
2009
2008
Profit for the Year
Other Comprehensive Income :
Exchange differences in translating foreign operations
Gain ( loss) on fair value changes in available for sale financial instruments
Gain (loss) fair value changes in Cash Flow Hedges
Gain on Revaluation of Property , Plant and Equipment
Actuarial Gain ( Loss) on defined benefit pension plans
Share of other comprehensive income of associates
Income tax relating to items of other comprehensive income

20. Statement of Other Comprehensive Income
2009
2008
Other Comprehensive Income net of tax
Total Comprehensive Income for the year
Profit attributable to :
Owners of the entity
Non-controlling interest
Total Comprehensive Income attributable to :
Earning per share
Basic
Diluted

21. 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
Write-downs of inventories to net realisable value as well as reversals of such write downs
Write down of property , plant and equipment to recoverable amount as well as reversals of such write downs
Restructuring activities of an entity and reversals of any provisions for the costs of restructuring
Disposal of items of property, plant and equipment
Disposal of investments
Discontinued operations
Litigation settlements
Other reversals of provisions.

22. Statement of Changes in Equity
Paras 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.

23. 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.