2. Dedication To our beloved Palestine, the country that made us what we are today To our dear families – deceased and alive – who walked us through every step of our lives. To our great university that gave us the opportunity to present this work. To our dear professor who provided us with great inspiration to achieve this point of our lives. To our well respected colleagues who have made a very understanding brotherhood among all. To our supportive friends who stood by our sides through everything in life and in studying. To US , as we get this opportunity to show our thoughts today, we hope we will succeed enough in future to work and share more. We dedicate this study …
4. PART 1: INTRODUCTION Objective of the study FASB & IASB financial statement presentation project
5. Part 1 : introduction The main objectives of this study is to answer these questions: What is the FASB and IASB financial statement presentation joint project? What is the definition of Comprehensive Income according to SFAS 130 and IAS 1? How comprehensive income should be reported? What are the main differences between SFAS 130 and IAS 1? And what are the amendments on the standards?
6. Part 1 : introduction FASB & IASB Projects: The joint project between the IASB and the US-FASB ‘s goal is to improve the usefulness of the financial information provided in an entity’s financial statements to assist management to better communicate its financial information to the users of its financial statements, and to help users in their decision-making.
7. Part 1 : introduction The IASB is conducting the project in three main phases: Phase B (in progress) Replacement of IAS 1 and IAS 7Addresses more fundamental issues for presentation of information in the financial statements.
8. PART 2: FASB – SFAS 130 Introduction to SFAS 130 Comprehensive income elements Presenting information for comprehensive income Amendments to SFAS 130
9. Part 2 :FASB - SFAS 130 Introduction to SFAS 130 SFAS No. 130,, requires a company to report comprehensive income and its components in a full set of financial statements. Comprehensive income is the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources.
10. Part 2 :FASB - SFAS 130 Comprehensive income can be most easily understood if it is divided into its two major components:
11. Part 2 :FASB - SFAS 130 SFAS No. 130 requires a company to calculate reclassification adjustments for all items of other comprehensive income except minimum pension liability adjustments.
12. Part 2 :FASB - SFAS 130 Comprehensive income elements
13. Part 2 :FASB - SFAS 130 Comprehensive income elements
15. Part 2 :FASB - SFAS 130 Reporting comprehensive income SFAS 130 does not require a specific format for the financial statement in which comprehensive income is reported. However, it does require the display of net income as a component of comprehensive income in that statement and that the statement be displayed
17. Part 2 :FASB - SFAS 130 It provides flexibility as to how that information may be displayed. It may be reported at a gross amount or at net amount comprehensive income components may be disclosed either net of taxes or before taxes.
18. Part 2 :FASB - SFAS 130 Earnings Per Share amounts are not required for total comprehensive income or its components. The accumulated balance of other comprehensive income items is to be reported in the equity section of the balance sheet in a category separate from contributed capital and retained earnings.
22. Part 3: IASB -IAS 1 Introduction to IAS 1 Comprehensive Income classifications and terms Presentation of comprehensive income Amendments to IAS 1 Interaction with other projects
23. Part 3: IASB -IAS 1 Introduction to IAS 1 IAS 1 sets overall requirements for the presentation of financial statements, guidelines for their structure and minimum requirements for their content. IAS 1 requires an entity to present, in a statement of changes in equity, all owner changes in equity. All non-owner changes in equity (i.e. comprehensive income) are required to be presented in one statement of comprehensive income or in two statements.
24. Part 3: IASB -IAS 1 Comprehensive Income classifications and terms Minimum items on the face of the statement of comprehensive income should include:
25. Part 3: IASB -IAS 1 Presentation of comprehensive income
26. Part 3: IASB -IAS 1 No items may be presented in the statement of comprehensive income or in the notes as 'extraordinary items'.
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30. Part 3: IASB -IAS 1 An entity shall disclose separately the following items in the statement of comprehensive income as allocations for the period:
31. Part 3: IASB -IAS 1 Amendments to IAS 1 The revised standard introduces “total comprehensive income”, which represents the change in equity during a period, other than changes resulting from transactions with owners in their capacity as owners.
33. Part 3: IASB -IAS 1 The proposed amendment does not change the calculation of EPS. This project does not change what is presented in profit or loss and what is presented in OCI, or how EPS is calculated. The proposed amendment simply changes the presentation of profit or loss and OCI so that they would be shown as two separate sections.
34. Part 3: IASB -IAS 1 Interaction with other projects
45. Part 4: conclusion Effects of amendments With effect from 2009 it is expected that accounting statements prepared under IFRS would no longer have to be reconciled with US GAAP for SEC purposes. Analysts would no longer have to contend with statements written in a different accounting language.
46. Part 4: conclusion There is considerably enhanced emphasis on fair presentation of financial statements and the concept of fair value and accrual basis of accounting. Since IFRS and US GAAP are the two most widely used standards, this project aims at bridging the gap.
47. Thank you … Done by: Sarah Alian KayanAlSarraj Produced by: Mr. EmadAbuShabaan
