Financial Statement Analysis Chapter 3 Financial Statements Bonsón, E., Cortijo, V., Flores, F.    Content on this file is...
Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive ...
Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive ...
Introduction <ul><li>IAS 1 , Presentation of Financial Statements, describes overall requirements for the presentation of ...
Introduction <ul><li>IAS 1 defines guidelines for the structure of financial statements and  minimum requirements  for the...
Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive ...
Statement of financial position <ul><li>formerly known as  balance sheet , it provides information about the economic reso...
Statement of financial position <ul><li>Under IAS 1, companies are required to classify its assets and liabilities into tw...
 
 
 
 
Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive ...
Statement of comprehensive income <ul><li>It appeared as a consequence of the last  revision  of the IAS 1 </li></ul><ul><...
Statement of comprehensive income <ul><li>It includes, not only all the components of “ profit or loss ” but also all the ...
Statement of comprehensive income <ul><li>Components of comprehensive income can be presented either in a single statement...
 
 
Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive ...
Statement of changes in equity <ul><li>It must include the following information on the face of the statement: </li></ul><...
Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive ...
Statement of cash flows <ul><li>Fully explained in  IAS 7 , it provides information about the cash receipts and cash payme...
 
to be continued
continued
to be continued
to be continued
continued
Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive ...
Notes to the financial statements <ul><li>The objectives of the notes to the financial statements are </li></ul><ul><li>to...
 
 
Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive ...
Chromosome of valuation and presentation for each company <ul><li>Alternative options allowed by IFRS </li></ul><ul><li>Pr...
Company chromosome, first view
Chromosome usefulness in future chapters To define calculable analysis indicators To define comparable analysis indicators
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FSA Chapter 3

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FSA Chapter 3

  1. 1. Financial Statement Analysis Chapter 3 Financial Statements Bonsón, E., Cortijo, V., Flores, F.   Content on this file is licensed under a Creative Commons Attribution Non-Commercial No Derivatives Works 3.0
  2. 2. Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive income </li></ul><ul><li>Statement of changes in equity </li></ul><ul><li>Statement of cash flows </li></ul><ul><li>Notes to the financial statements </li></ul><ul><li>Chromosome of valuation and presentation for each company </li></ul>
  3. 3. Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive income </li></ul><ul><li>Statement of changes in equity </li></ul><ul><li>Statement of cash flows </li></ul><ul><li>Notes to the financial statements </li></ul><ul><li>Chromosome of valuation and presentation for each company </li></ul>
  4. 4. Introduction <ul><li>IAS 1 , Presentation of Financial Statements, describes overall requirements for the presentation of general-purpose financial statements, as well as guidelines for their structure and minimum requirements for their content. </li></ul>
  5. 5. Introduction <ul><li>IAS 1 defines guidelines for the structure of financial statements and minimum requirements for their presentation and content but it does not prescribe the order or format </li></ul><ul><li>Based on the information provided by this standard and the rest of IFRS, the IASC Foundation XBRL Team has been developing, since 2002, IFRS Taxonomies –that is, digital templates - in order to facilitate the adoption of IFRS </li></ul>
  6. 6. Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive income </li></ul><ul><li>Statement of changes in equity </li></ul><ul><li>Statement of cash flows </li></ul><ul><li>Notes to the financial statements </li></ul><ul><li>Chromosome of valuation and presentation for each company </li></ul>
  7. 7. Statement of financial position <ul><li>formerly known as balance sheet , it provides information about the economic resources owned by a company (assets) as well as the financial resources used to acquire them (liabilities and equity) at a moment in time </li></ul>
  8. 8. Statement of financial position <ul><li>Under IAS 1, companies are required to classify its assets and liabilities into two different categories: current and non current </li></ul><ul><li>Alternatively , IAS 1 allows companies to show its assets and liabilities on a liquidity basis when this presentation format provides more reliable or relevant information. </li></ul>
  9. 13. Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive income </li></ul><ul><li>Statement of changes in equity </li></ul><ul><li>Statement of cash flows </li></ul><ul><li>Notes to the financial statements </li></ul><ul><li>Chromosome of valuation and presentation for each company </li></ul>
  10. 14. Statement of comprehensive income <ul><li>It appeared as a consequence of the last revision of the IAS 1 </li></ul><ul><li>It provides the analyst with information about the performance of a company </li></ul><ul><li>It is really useful to assess potential changes in the economic resources owned by the entity, predict future cash flows , and make other informed predictions </li></ul>
  11. 15. Statement of comprehensive income <ul><li>It includes, not only all the components of “ profit or loss ” but also all the components of “ other comprehensive income ” that are: </li></ul><ul><ul><li>Changes in revaluation surplus </li></ul></ul><ul><ul><li>Actuarial gains and losses on defined benefit plans </li></ul></ul><ul><ul><li>Translations gains and losses </li></ul></ul><ul><ul><li>Gains and losses on re-measuring available-for-sale financial assets </li></ul></ul><ul><ul><li>Effective portion of gains and losses on hedging instruments in a cash flow edge </li></ul></ul>
  12. 16. Statement of comprehensive income <ul><li>Components of comprehensive income can be presented either in a single statement or in two statements </li></ul><ul><li>If a company chooses the second option, it must prepare a separate income statement , which includes all components of profit or loss and distinguishes between profit (loss) from continuing and discontinued operations </li></ul><ul><li>The company can classify expenses according to their nature of their function </li></ul>
  13. 19. Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive income </li></ul><ul><li>Statement of changes in equity </li></ul><ul><li>Statement of cash flows </li></ul><ul><li>Notes to the financial statements </li></ul><ul><li>Chromosome of valuation and presentation for each company </li></ul>
  14. 20. Statement of changes in equity <ul><li>It must include the following information on the face of the statement: </li></ul><ul><ul><li>total comprehensive income for the period (disclosing in different sections amounts attributable to owners and to minority interest). </li></ul></ul><ul><ul><li>for each component of equity, the effects of retrospective application or retrospective restatement recognized in accordance to IAS 8 , Accounting Policies, Changes in Accounting Estimates and Errors. </li></ul></ul><ul><ul><li>transactions with owners , providing information about contributions from and distributions to owners. </li></ul></ul><ul><ul><li>for each component of equity, the reconciliation between the carrying amounts at the beginning and at the end of the period, separately disclosing each change. </li></ul></ul>
  15. 21. Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive income </li></ul><ul><li>Statement of changes in equity </li></ul><ul><li>Statement of cash flows </li></ul><ul><li>Notes to the financial statements </li></ul><ul><li>Chromosome of valuation and presentation for each company </li></ul>
  16. 22. Statement of cash flows <ul><li>Fully explained in IAS 7 , it provides information about the cash receipts and cash payments of an entity during a period classified by </li></ul><ul><ul><li>operating (can be presented under the direct or the indirect method. Although the direct method has been strongly endorsed by the IASB, very few reporting companies decided to use it) </li></ul></ul><ul><ul><li>investing and </li></ul></ul><ul><ul><li>financing activities </li></ul></ul><ul><li>It can be used to estimate the amount, timing and certainty of future cash flows </li></ul>
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  22. 29. Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive income </li></ul><ul><li>Statement of changes in equity </li></ul><ul><li>Statement of cash flows </li></ul><ul><li>Notes to the financial statements </li></ul><ul><li>Chromosome of valuation and presentation for each company </li></ul>
  23. 30. Notes to the financial statements <ul><li>The objectives of the notes to the financial statements are </li></ul><ul><li>to complement , clarify and qualify the information included in general-purpose financial statements </li></ul><ul><li>to provide information about the basis of preparation of the financial statements and the specific accounting policies adopted </li></ul><ul><li>to report information required by IAS which is not presented elsewhere and additional information </li></ul><ul><li>They must be presented in a systemic manner, so each item on the face of the financial statements must be cross-referenced </li></ul>
  24. 33. Index <ul><li>Introduction </li></ul><ul><li>Statement of financial position </li></ul><ul><li>Statement of comprehensive income </li></ul><ul><li>Statement of changes in equity </li></ul><ul><li>Statement of cash flows </li></ul><ul><li>Notes to the financial statements </li></ul><ul><li>Chromosome of valuation and presentation for each company </li></ul>
  25. 34. Chromosome of valuation and presentation for each company <ul><li>Alternative options allowed by IFRS </li></ul><ul><li>Presentation of financial statements </li></ul><ul><ul><li>Alternative options for: </li></ul></ul><ul><ul><ul><li>Statement of financial position </li></ul></ul></ul><ul><ul><ul><li>Income statement </li></ul></ul></ul><ul><ul><ul><li>Cash flow statement </li></ul></ul></ul><ul><li>Valuation of assets </li></ul><ul><ul><li>Alternative options for: </li></ul></ul><ul><ul><ul><li>Property plant and equipment </li></ul></ul></ul><ul><ul><ul><li>Investment property </li></ul></ul></ul><ul><ul><ul><li>Intangibles other than goodwill </li></ul></ul></ul>
  26. 35. Company chromosome, first view
  27. 36. Chromosome usefulness in future chapters To define calculable analysis indicators To define comparable analysis indicators

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