Investor Presentaiton
KPMG
HKAS 1.8, 10,
10A
46 In this illustration, HK Listco uses the titles "Statement of profit or loss" and "Statement of profit or loss and other comprehensive
income", which are the titles used in HKAS 1. However, as allowed by paragraph 10 of HKAS 1, an entity may use other titles, such
as "Income statement" and "Statement of comprehensive income".
HKAS 1.106
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HKAS 1.7, 81A-
82A
HKAS 1.113
HKAS 1.29, 30A,
85
HKAS 1.85A-85B
HKAS 1.99
HKAS 2.38
HKAS 1.45 & 85
Similarly, although HKAS 1 uses the terms "other comprehensive income", "profit or loss" and "total comprehensive income", an
entity may use other terms to describe the totals as long as the meaning is clear. For example, an entity may use the term "net
income" to describe profit or loss.
Whatever titles and terms are used, care should be taken to ensure that they are used consistently throughout the financial
statements.
HKAS 1 requires an entity to separately present non-owner changes in equity (i.e. items of income and expense) from owner
changes in equity (i.e. all other changes in equity, such as from capital injections or dividends paid).
For non-owner changes in equity, the standard uses the term "total comprehensive income" to refer to all items of income and
expense, whether or not recognised in profit or loss. HKAS 1 allows a choice of format for disclosing comprehensive income
between either:
(i) presenting a statement of profit or loss to arrive at "profit or loss", and then immediately afterwards presenting a statement
of profit or loss and other comprehensive income which begins with "profit or loss" for the period (as derived from the
statement of profit or loss) and then presents all other items of comprehensive income (such as changes in revaluation surplus
on property, plant and equipment under paragraphs 39 and 40 of HKAS 16) in order to arrive at "total comprehensive
income"; or
(ii) presenting all items of total comprehensive income in a single statement of profit or loss and other comprehensive income.
In this illustration, HK Listco has opted for the two-statement approach in (i) above.
48 Each item on the face of the statement of profit or loss/the statement of profit or loss and other comprehensive income shall be
cross-referenced to any related information in the notes.
HKAS 1 requires an entity to present separately items of a dissimilar nature or function, unless they are immaterial, and take into
consideration all relevant facts and circumstances in deciding how it aggregates information in the financial statements. The entity
should not reduce the understandability of the financial statements by aggregating material items that have different natures or
functions. In some cases, the entity may need to further disaggregate the line items in the statement of financial position and the
statement of profit or loss and other comprehensive income beyond the "minimums" prescribed in HKAS 1 to improve the
understandability of the financial statements. However, the entity need not disclose immaterial information, even though the
information is specifically required by a HKFRS or is described as "minimum requirement".
HKAS 1 also requires that when an entity presents additional subtotals (i.e. in addition to those specifically required by HKFRS) in
the statement of financial position and statement of profit or loss and other comprehensive income, it should also present line
items that reconcile those additional subtotals with the subtotals or totals required by HKFRS.
49 The analysis of expenses can be shown either on the face of the statement of profit or loss (or the statement of profit or loss and
other comprehensive income if a separate statement of profit or loss is not presented), or in the notes. The analysis presented
here is referred to as the "function of expense" or "cost of sales" method (paragraph 103 of HKAS 1). The analysis could
alternatively be presented using a classification based on the nature of expenses (paragraph 102 of HKAS 1).
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When an entity classifies expenses based on function, HKAS 2 notes that the amount of inventories recognised as an expense
during the period (often referred to as "cost of sales") consists of those costs previously included in the measurement of inventory
that has now been sold, and unallocated production overheads and abnormal amounts of production costs of inventories.
Neither HKAS 1 nor HKAS 40 prescribes where movements in the fair value of investment property should be presented on the face
of the statement of profit or loss/the statement of profit or loss and other comprehensive income, nor whether they should be
separately presented from other items of income and expense. However, once a form of presentation has been adopted by an
entity, it should be followed consistently from one period to the next unless it is apparent that another presentation would be
more appropriate.
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