So why the need for IFRS 18?
If you are already familiar with IAS 1, you will recognise much of what is in IFRS 18 Presentation and Disclosure in Financial Statements. However, there are some significant additions and changes which are important and these in particular are the focus of this technical briefing. IFRS 18 is being introduced in response to stakeholders asking for better information on issues within the profit or loss account.
The official justification for the introduction of IFRS 18 is that stakeholders had asked for better information on issues within the profit or loss account in particular. This in itself is interesting. Many of the IFRS Accounting Standards concentrate on the balance sheet, though of course there is an interaction between items within this particular statement, the balance sheet and the profit or loss account. However, the profit or loss account is important to investors. They stand to benefit either from the payment of dividends or capital growth which is driven by earnings. Reading between the lines we might think that there have been occasions in the past when in some cases the information in the profit or loss account was not quite as good as it should have been.
IFRS 18 | WHY THE NEED FOR IFRS 18?
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