This chapter introduces the standard collection of statements that are required on an annual basis under IFRS. The chapter reviews each of the main statements, the Statement of Comprehensive Income, the Statement of Financial Position and the Statement of Cash Flows. It goes on to discuss the factors that guide the choice of accounting policies and accounting policy change. After that it discusses fair presentation and finally interim financial statements. The chapter ends with an appendix that introduces the IASB Conceptual Framework.

The next six chapters will introduce you to the technical content of IFRS. They are organized by theme, starting with the presentation of accounting statements. Later chapters will deal with business combinations, income statement items, balance sheet line items, how to make accounting policy choices and first time adoption of IFRS.

The first thing to address is the confusing names that abound in the international standard-setting world. Firstly the standards themselves go under two different names. Those issued between 1973 and 2001 are called ‘International Accounting Standards’ (IAS), and those issued after that are called ‘International Financial Reporting Standards’ (IFRS). The difference is a semantic one: some people think that the standards do not refer to accounting (defined as the way a company organizes information in its accounting database) but rather to the way it draws up its financial statements. ...

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