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Information to be presented on the face of the balance sheet
The following minimum information is to be presented
on the face of the balance sheet [IAS1R.68]:
| a) |
property, plant and equipment; |
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| b) |
investment property;
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| c) |
intangible assets; |
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| d) |
financial assets (excluding
amounts shown under (e), (h) and (i)); |
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| e) |
investments accounted for using
the equity method; |
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| f) |
biological assets; |
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| g) |
inventories; |
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| h) |
trade and other receivables; |
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| i) |
cash and cash equivalents; |
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| j) |
trade and other payables; |
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| k) |
provisions; |
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| l) |
financial liabilities (excluding
amounts shown under (j) and (k)); |
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| m) |
liabilities and assets for current
tax; |
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| n) |
deferred tax liabilities and
deferred tax assets; |
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| o) |
minority interest, presented
within equity; and |
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| p) |
issued capital and reserves
attributable to equity holders of the parent. |
Management may choose a vertical or a horizontal
format, the level of detailed sub-classifications
and, except for the minimum requirements, what information
is to be disclosed on the face of the balance sheet
or in the notes.
Line items should be presented broadly in terms
of liquidity [IAS1R.51]. This may be either in increasing
or decreasing order of liquidity.
Extended Structure
Management should also include any other line items
and totals or sub-totals as may be required by individual
standards or as are required in order for the financial
statements to be fairly presented [IAS1R.69].
In determining the degree of additional analyses
provided, the preparer should consider [IAS1R.72(a)-(c)]:
| a) |
the nature and liquidity of the assets
and their materiality; |
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| b) |
their function within the entity; and |
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| c) |
the amounts, nature and timing
of liabilities. |
Additional detail and disclosure of the line items
presented in the financial statements is required
either on the face of the balance sheet or in the
notes in a manner appropriate to the entity's operations.
[IAS1R.74-75].
The current/non-current distinction
Entities are required to present a classified balance
sheet [IAS1R.51], which distinguishes working capital
from other assets and liabilities, except when a
presentation based on liquidity provides information
that is reliable and is more relevant. An item is
classified as current if it is involved in the entity's
operating cycle or is expected to be realised within
twelve months of the balance sheet date [IAS1R.57]
. The exceptions are entities in
the banking and insurance industry, which tend not
to use a classified balance sheet [IAS30.18]
.
Information about the liquidity of an entity's
assets and liabilities is highly relevant. All entities
should therefore identify all assets and liabilities
expected to be recovered or settled after more than
twelve months from the balance sheet date [IAS1R.52].
Where a classified balance sheet is not presented,
the analysis is usually given in the notes.
An entity that does not present a classified balance
sheet should, however, present its assets and liabilities
broadly in order of liquidity [IAS1R.51].
Current assets
Only assets that meet the definition of a current
asset should be classified as current. All others
should be classified as non-current assets [IAS1R.57].
Cash and cash equivalents
Current assets exclude cash deposits that have a
maturity date greater than twelve months after the
balance sheet date [IAS1R.57(c)]. Balances that
have long-term legal restrictions on availability,
for example solvency guarantees or restricted balances,
are also excluded [IAS1R.57(d)]
.
Receivables and inventories
Trade receivables, inventories, and prepayments
should be classified as current assets because they
will be realised in the entity's operating cycle
[IAS1R.57(a)]. If the expected realisation of receivables
exceeds twelve months from the balance sheet date,
this should be disclosed [IAS1R.57(c)] .
Related party receivables should be classified
as current only when there is both the ability and
intention to realise those amounts within the next
twelve months . Amounts due from
shareholders that arise from unpaid capital contributions
are shown as a reduction of shareholders' equity
.
Financial assets
Financial assets held for trading should be classified
as current assets. Held-to-maturity investments
and available-for-sale investments, however, should
only be classified as current assets if realisation
within twelve months is expected. All other held-to-maturity
and available-for-sale financial assets would be
classified as non-current assets .
Assets held for disposal
Long-term assets and liabilities that an entity
now expects to realise or settle within the next
twelve months should be reclassified . Disposals
relating to a separate major line of business or
geographical area of operation represent discontinuing
operations, for which specific disclosures are required
(Disposal groups and discontinued operations) [IAS35.27-48].
Current liabilities
All liabilities meeting the definition of a current
liability should be classified as such. However,
the classification of some liabilities may require
taking into consideration not only the definition
of current liability, but also the guidance provided
in other standards .
Some liabilities may require reclassification to
non-current liabilities where an entity may expect
to refinance for at least twelve months after the
balance sheet date under an existing loan facility.
However, when refinancing the obligation is not
at the discretion of the entity, the obligation
is classified as current. The potential to refinance
is not considered [IAS1R.63-64] .
Other liabilities meeting the definition of a non-current
liability may require reclassification to current
liabilities. For example, when an entity breaches
a covenant under a long-term loan agreement and
the liability becomes payable on demand, the liability
is classified as current at the balance sheet date.
This applies even if the lender has agreed after
the balance sheet date and before the authorisation
of the financial statements for issue, not to demand
payment as a consequence of the breach [IAS1R.65].
The liability will only be reclassified as non-current
if the lender agreed by the balance sheet date to
provide a period of grace ending at least twelve
months after the balance sheet date. The entity
will need to be able to rectify the breach during
that period and the lender will not be able to demand
immediate repayment [IAS1R.66] .
Equity and minority interests
Equity capital and reserves should be analysed
showing separately the various classes of paid-in
capital, share premium and reserves .
Depending on the materiality and significance of
the analysis, much of the details can be presented
in the notes rather than on the face of the balance
sheet [IAS1R.75].
Minority interests in consolidated financial statements
shall be presented as a component of equity, separately
from the parent shareholders' equity [IAS27R.33].
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