IFRS Accounting Standards In Practice - IFRS 18 Presentation and Disclosure in Financial Statements
IFRS Accounting Standards In Practice - IFRS 18 Presentation and Disclosure in Financial Statements
BDO has released IFRS Accounting Standards In Practice - IFRS 18 Presentation and Disclosure in Financial Statements (Presentation in the Statement of Profit or Loss).
This publication is an in depth and comprehensive guide to the requirements of IFRS 18 applicable to the preparation of the statement of profit or loss and includes dozens of flowcharts, examples and practical insights about how IFRS 18 will affect entities that apply IFRS Accounting Standards.
IFRS 18 is mandatorily effective for annual reporting periods beginning on or after 1 January 2027 (i.e. 31 December 2027 annual financial statements for entities with calendar year-ends), subject to any relevant jurisdictional endorsement. Earlier application is permitted.
The issuance of IFRS 9 Financial Instruments, IFRS 15 Revenue from Contracts with Customers, IFRS 16 Leases, and IFRS 17 Insurance Contracts fundamentally changed the measurement requirements of IFRS Accounting Standards for many transactions entities commonly enter into, and IFRS 18 is expected to have a similarly significant effect on how entities present their financial statements.
While IFRS 18 does not change any of the recognition and measurement requirements in IFRS Accounting Standards, the effect of the new standard should not be underestimated by entities. The IASB has given preparers approximately three (3) years to prepare for the adoption of the standard, which is a similar implementation timeframe similar to that given for the implementation of IFRS 9, 15 and 16.
Before exploring the requirements of IFRS 18 relating to the statement of profit or loss, it is useful to understand the history that led to the development and issuance of IFRS 18