Guide to annual financial statements – Disclosure checklist

IFRS

Guide to

annual financial

statements �C

Disclosure

checklist

LEASES

OFFSETTING

ACCOUNTING POLICIES

SHARE-BASED PAYMENT PERFORMANCE

CARRYING AMOUNT

UPDATE

L OA N S B O R R O W I N G S

IMPAIRMENT

COST CONSOLIDATION

PENSION PROFIT OR LOSS IFRS

AS S UM P TI ONS

REVENUE

DISCONTINUED OPERATIONS

PRESENTATION

ASSOCIATE

INVENTORIES

OPERATING SEGMENTS

NON-CONTROLLING INTERESTS

P

R OV I S I O N S

DISCONTINUED OPERATIONS

JUDGEMENT

TRANSACTIONS

SHARE-BASED PAYMENT

FINANCIAL INSTRUMENTS ACCOUNTING POLICIES

FINANCIAL POSITION CASH FLOWS

FAIR PRESENTATION

CAPITAL

ASSETS

CGU

NCI

DERIVATIVES

GROUP

IFRS

NOTES

JOINT ARRANGEMENTS

GOODWILL ESTIMATES OFFSETTING OCI

EPS

LIABILITIES CONSOLIDATION

CURRENT

TRANSACTIONS

EQUITY

2013

PROFIT OR LOS S

CASH EQUIVALENTS

SUBSIDIARY

ANNUAL

PRESENTATION

FAIR VALUE

BUSINESS COMBINATIONS

PERFORMANCE

ESTIMATES

OCI

STATEMENT

BUSINESS COMBINATIONS

FAIR VALUE

PRESENTATION

OPERATING SEGMENTS

IFRS

AS S ET S

CASH FLOWS

UNCONSOLIDATED STRUCTURED ENTITIES FINANCIAL POSITION

ifrs

GOING CONCERN

DISPOSAL

FINANCIAL POSITION SHARE-BASED PAYMENT EPS JOINT ARRANGEMENTS DISCLOSURES HELD-FOR-SALE PENSION

CHECKLIST

September 2013

FAIR VALUE MEASUREMENT ACCOUNTING POLICIES

CONTINGENCY RELATED PARTY

INTANGIBLEASSETS

GOING CONCERN PERFORMANCE OFFSETTING

PROFIT OR LOSS MATERIALITY

ACQUISITION TAX

COMPARATIVE VALUATION UPDATE

MATERIALITY

PENSION

FAIR VALUE

Contents

From compliance to communication

1

What��s new?

2

About this guide

3

The checklist

4

1 General presentation

4

1.1

1.2

1.3

1.4

1.5

1.6

1.7

1.8

1.9

1.10

Presentation of financial statements

Changes in equity

Statement of cash flows

Basis of accounting

Fair value measurement

Consolidated and separate financial statements

Business combinations

Foreign currency translation and hyperinflation

Accounting policies, errors and estimates

Events after the reporting period

2 Statement of financial position

2.1 Property, plant and equipment

2.2 Intangible assets and goodwill

2.3 Investment property

2.4 Associates

2.5 Joint arrangements

2.6 Financial instruments

2.7 Inventories

2.8 Biological assets

2.9 Impairment of non-financial assets

2.10 Equity

2.11 Provisions

2.12 Income taxes

2.13 Contingent assets and liabilities

3 Statement of profit or loss and OCI

3.1

3.2

3.3

3.4

3.5

Revenue

Government grants

Employee benefits

Share-based payments

Borrowing costs

4 Special topics

4.1

4.2

4.3

4.4

4.5

4.6

4.7

4.8

4.9

Leases

Service concession arrangements

Operating segments

Earnings per share

Non-current assets held for sale or held for

distribution

Related party disclosures

Insurance contracts

Extractive activities

Common control transactions and Newco

formations

5 First-time adoption of IFRS

4

14

16

18

24

26

31

36

37

39

41

41

42

45

47

50

53

63

63

65

66

67

68

69

71

71

71

72

76

78

79

79

81

81

85

86

87

92

96

97

98

6 Voluntary early adoption of IFRSs

6.1 IFRS 9 Financial Instruments (2010)

6.2 IFRS 9 Financial Instruments (2009)

6.3 Investment Entities (Amendments to IFRS 10,

IFRS 12 and IAS 27)

6.4 Recoverable amount disclosures for non-financial

assets (Amendments to IAS 36)

101

101

109

115

118

Appendix �C IFRSs that are effective for the first time

or are available for early adoption

119

Keeping you informed

120

From compliance to communication:

What��s your story?

2013 sees a number of new and revised IFRSs come into effect, some of which contain significant new disclosures. This

publication, together with the illustrative disclosures in our Guide to financial statements suite, sets out and illustrates many of

the potential disclosure requirements under IFRS.

Although understanding the potential disclosure requirements is an important first step towards preparing your financial

statements, there is a growing recognition that good financial statements �C and corporate reports in general �C have to go

beyond mere compliance to better communicate an entity��s performance and development. This might entail the use of plain

language, the removal of immaterial disclosures and, most significantly, a better integration of financial statement disclosures

with other components of the annual report to tell a single coherent story about the entity��s business model, strategy, risks

and performance.

This is no easy task, and cannot be achieved simply by complying with every disclosure listed in IFRS. Every entity has a unique

story to tell, and its financial statements should also stand apart if they are to communicate that story effectively.

This publication will act as a starting point as you begin your journey, by providing you with the list of potential disclosure

requirements under IFRS. But you will still have a lot of thinking to do. After all, only you know your story. Now you need to

decide the best way to tell it.

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2 | Guide to annual financial statements �C Disclosure checklist

What��s new?

This new Guide to annual financial statements �C Disclosure checklist has been updated to take account of the following.

���

Disclosures �C Offsetting Financial Assets and Financial Liabilities (Amendments to IFRS 7) (Chapter 2.6 ��Financial

instruments��).

���

IFRS 10 Consolidated Financial Statements (Chapter 1.6 ��Consolidated and separate financial statements��).

���

IFRS 11 Joint Arrangements (Chapter 2.5 ��Joint arrangements��).

���

���

���

IFRS 12 Disclosure of Interests in Other Entities (Chapters 1.6 ��Consolidated and separate financial statements��,

2.4 ��Associates�� and 2.5 ��Joint arrangements��).

IFRS 13 Fair Value Measurement (Chapter 1.5 ��Fair value measurements��).

Presentation of Items of Other Comprehensive Income (Amendments to IAS 1) (Chapter 1.1 ��Presentation of financial

statements��).

���

IAS 19 Employee Benefits (2011) (Chapter 3.3 ��Employee benefits��).

���

IAS 27 Separate Financial Statements (2011) (Chapter 1.6 ��Consolidated and separate financial statements��).

���

IAS 28 Investments in Associates and Joint Ventures (2011) (Chapter 2.4 ��Associates��).

���

���

Recoverable Amount Disclosures for Non-Financial Assets (Amendments to IAS 36) (Section 6 ��Voluntary early adoption

of IFRSs��).

Annual Improvements to IFRSs �C 2009�C2011 Cycle (Chapter 1.1 ��Presentation of financial statements�� and Section 5

��First?time adoption of IFRS��).

The major changes from the August 2012 edition in Sections 1 to 5 are highlighted by a double line running down the left margin

of the text within those sections.

? 2013 KPMG IFRG Limited, a UK company, limited by guarantee. All rights reserved.

About this guide | 3

About this guide

This guide has been produced by the KPMG International Standards Group (part of KPMG IFRG Limited) and the views

expressed herein are those of the KPMG International Standards Group.

It helps you to prepare financial statements in accordance with IFRS by identifying the potential disclosures required.

Standards covered

This guide reflects IFRSs in issue at 15 August 2013.

Sections 1 to 5 of this guide reflect IFRSs that are required to be applied by an entity with an annual reporting period beginning

on 1 January 2013 ('currently effective�� requirements).

Section 6 of this guide identifies IFRS disclosure requirements that are effective for annual reporting periods beginning after

1 January 2013 (��forthcoming�� requirements) and that are available for voluntary early adoption.

The appendix includes a list of the new currently effective requirements and forthcoming requirements, and a reference to the

related sections in this guide.

This guide contains disclosures only. It does not specify the scope of individual IFRSs referred to or their recognition and

measurement requirements, or explain the terms that are used in IFRS and contained in this guide. Nor does it cover IAS 26

Accounting and Reporting by Retirement Benefit Plans and IAS 34 Interim Financial Reporting. The disclosures potentially

required by IAS 34 are set out in our Guide to condensed interim financial statements �C Disclosure checklist.

It is possible that standards and interpretations could be amended after 15 August 2013, with the amendments applicable to

financial statements for periods beginning on or after 1 January 2013. Any such changes and additional requirements would

need to be considered when preparing financial statements in accordance with IFRS.

This guide should not be used as a substitute for referring to IFRS itself.

References in the margin identify any relevant paragraphs of the standards or other literature �C e.g. IAS 1.51 is paragraph 51 of

IAS 1; Insights 4.1.190.10 is paragraph 4.1.190.10 of the 10th Edition 2013/14 of our publication Insights into IFRS (find out more

at ifrs).

Legal or regulatory requirements

When preparing financial statements in accordance with IFRS, an entity should have regard to its local legal and regulatory

requirements. This guide does not consider the requirements of any particular jurisdiction.

Organisation of the text

This guide is arranged by topic. It is designed to provide all of the IFRS disclosures that may be required for a set of financial

statements when completed in its entirety. Disclosures that relate to more than one topic may not always be repeated under

each relevant topic. For example, the requirement to disclose accounting policies adopted for the recognition of revenue is

included in Chapter 1.4 ��Basis of accounting��, but not repeated in Chapter 3.1 ��Revenue��. It is therefore critical that this checklist

be completed in its entirety.

Need for judgement

Although we aim to provide a comprehensive list of the potential disclosure requirements under IFRS, individual entities should

tailor any disclosures to reflect their specific circumstances, including the materiality of the items concerned.

In addition, IFRS and its interpretation change over time. Accordingly, this publication should not be used as a substitute for

referring to the standards and interpretations themselves.

Reporting date

A number of terms are used, either in IFRS or in practice, to describe the end of an entity��s financial year, including ��reporting

date��, ��end of the reporting period��, ��statement of financial position date��, ��year end�� and ��financial year end��. Generally, these

terms are used interchangeably and have the same meaning. Throughout this guide, we refer to the ��reporting date��.

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