Measuring Profit and Income

About This Chapter

Understandably, both users external to a business and the managers working within it are interested in financial performance. One piece of information that is important is whether the business made a profit or loss over the financial period. There are six separate standards that set out the various methods to be applied in establishing a company’s profit or loss for a period. In summary, these are

IAS 1 Presentation of financial statements

IFRS 15 Revenue from contract with customers

IAS 2 Inventories

IAS 16 Property plant and equipment

IAS 11 Construction contracts (now superseded by IFRS 15 from January 1, 2018)

IAS 18 Revenue

It is important to emphasize that we are examining accounting ...

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