2. Presentation of financial statements

Question 1

2. What are the 3 ‘buckets’ of comprehensive income?

Answer 1

Revaluation surplus
Foreign currency translation reserve
Cash flow hedge reserve

Question 2

2. As per IAS 1 para. 10, a ‘complete set of financial statements’ contains?

Answer 2

• a statement of financial position
• a statement of profit or loss and other comprehensive income
• a statement of changes in equity
• a statement of cash flows
• notes, made up of a summary of significant accounting policies and other explanatory information
• comparative information for the preceding period
• 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, or reclassification, of items in its financial statements.

Question 3

2. What is included in the Statement of Changes of Equity?

Answer 3

Share Capital
Revaluation Surplus
Retained Earnings

Question 4

2. What are the three categories for a Statement of Cash Flow?

Answer 4

Operating
Investing
Financing

Question 5

2. What are the 6 steps to preparing GPFS?

Answer 5

1. Prepare the year-end adjusting entries
2. Prepare the year-end tax entries
3. Prepare the final trial balance
4. Prepare the statement of financial position, statement of profit or loss and other comprehensive income and statement of changes in equity
5. Prepare the statement of cash flows
6. Prepare the notes to the financial statements