This master thesis deals with Staff Draft of Exposure
Draft IFRS X Financial Statement Presentation (IFRS X)and analysis whether it is a boon or bane for the world of international financial reporting. IFRS X is going to replace IAS 1 Presentation of Financial Statements and IAS 7 Statement of Cash Flows. The analysis is based on a four step approach:
1) identification of the deficiencies of IAS 1/IAS 7,
2) detection of the changes in the financial statement presentation due to IFRS X,
3) analysis of the criticisms on IFRS X and judgment thereon and
4) answer to the key question.
Within this master thesis, sample financial statements are prepared according to IAS 1/IAS7, IFRS X and IFRS X as adjusted as a result of the conclusions drawn in step 3.
Table of Contents
- Introduction
- What are the deficiencies of IAS 1 and IAS 7?
- Deficiencies related to the content of IAS 1 and IAS 7
- Availability of too many options in IAS 1 and IAS 7
- Lack of valuable information due to missing requirements in IAS 1 and IAS 7
- Deficiencies related to the surrounding circumstances of IAS 1 and IAS 7
- Piecemeal development of IAS 1 and IAS 7
- Missing convergence between IFRS and US GAAP
- Conclusion and summary
- What are IFRS X's major changes to the financial statement presentation?
- Disaggregation principle
- Cohesiveness principle
- Structure of financial statements
- Concept of cash and cash equivalents
- Layout of the statement of financial position
- Classification of assets and liabilities
- Operating cash flow
- Analyses of changes in assets and liabilities
- Remeasurement disclosures
- Conclusion and summary
- What are the major criticisms on IFRS X and the consequences thereof?
- Disaggregation principle
- General idea of the disaggregation principle and disaggregation degree
- Location of disaggregated information
- Disaggregation of income and expenses
- Cohesiveness principle
- Structure of the financial statements
- Classification into the sections, categories and subcategory
- Classification principle: item's link to the activities
- Classification level: items' classification at the segment level
- Content and right to exist of the sections, categories and subcategory
- Business section and financing section
- Separation of the business activities from the financing activities
- Assignment of specific groups of line items
- Equity
- Liabilities
- Income tax section
- Multi category transaction section
- Discontinued operation section
- Cash, cash equivalents and short term investments
- Concept of cash and cash equivalents
- Assignment of cash and short term investments
- Layout of the statement of financial position
- Is the term balance sheet adequate for IFRS X's statement of financial position?
- Is the layout of IFRS X's statement of financial position beneficial?
- Classification of assets and liabilities
- Analysis of changes in assets and liabilities
- Remeasurement disclosures
- Operating cash flow
- Conclusion and summary
- Overall conclusion and summary
Objectives and Key Themes
This Master's thesis aims to assess the impact of IFRS X on the world of international financial reporting. It examines the deficiencies of current standards (IAS 1 and IAS 7) and analyzes the proposed changes introduced by IFRS X. The thesis explores the potential benefits and drawbacks of these changes, considering their impact on the presentation of financial statements, the information provided to users, and the overall quality of financial reporting.
- Evaluation of the deficiencies of current financial statement presentation standards (IAS 1 and IAS 7)
- Analysis of the proposed changes introduced by IFRS X
- Assessment of the potential benefits and drawbacks of IFRS X
- Exploration of the impact of IFRS X on the quality of financial reporting
- Discussion of the potential consequences of IFRS X for various stakeholders, including investors, creditors, and regulators
Chapter Summaries
Chapter 2 outlines the key deficiencies of IAS 1 and IAS 7, highlighting issues such as the availability of too many options, the lack of valuable information due to missing requirements, the piecemeal development of the standards, and the lack of convergence between IFRS and US GAAP.
Chapter 3 delves into the proposed changes brought about by IFRS X. The chapter discusses the disaggregation principle, the cohesiveness principle, the revised structure of financial statements, the redefined concept of cash and cash equivalents, the new layout of the statement of financial position, the classification of assets and liabilities, the treatment of operating cash flow, and the disclosures required for remeasurements.
Chapter 4 examines the major criticisms of IFRS X and their potential consequences. It explores the concerns surrounding the disaggregation principle, the cohesiveness principle, the structure of financial statements, the classification of assets and liabilities, and the handling of cash, cash equivalents, and short-term investments.
Keywords
The thesis focuses on the key concepts of IFRS X, financial statement presentation, disaggregation principle, cohesiveness principle, structure of financial statements, cash and cash equivalents, asset and liability classification, operating cash flow, and remeasurement disclosures. It also examines the impact of these changes on the quality of financial reporting and the information needs of users.
- Arbeit zitieren
- M. A. in Accounting and Controlling Christian Franz Georg Zube (Autor:in), 2011, IFRS X Financial Statement Presentation – a boon or bane for the world of international financial reporting?, München, GRIN Verlag, https://www.grin.com/document/177409
