STATEMENT OF FINANCIAL POSITION

Formerly known as the balance sheet

Shows an entitys assets, liabilities and equity at a specific date
Shows the entitys financial condition as of a certain date
May be unclassified or classified

Specific items (line items) included in the statement of financial position

IAS 1, par. 54
Property, plant and equipment
Noncurrent assets held for sale
Investment property
Trade and other payables
Intangible assets
Provisions
Financial assets
Financial liabilities
Investments accounted for using the equity Liabilities and assets for current tax
method
Biological assets
Deferred tax liabilities and assets
Investments
Liabilities included in disposal
classified as held for sale
Trade and other receivables
Non-controlling interest
Cash and cash equivalents
Issued capital and reserves

groups

Assets and liabilities are classified into current and noncurrent.

Assets and liabilities are presented in the statement of financial position in order of liquidity.

Current assets (IAS 1.66)

Expected to be realized, sold or consumed in the entitys normal operating cycle

Held primarily for the purpose of trading
Expected to be realized within 12 months after the reporting period
Unrestricted cash or cash equivalent

Current liabilities (IAS 1.69)

Expected to be realized in the entitys normal operating cycle

Held primarily for the purpose of trading
Due to be settled within 12 months after the reporting period
Entity does not have the unconditional right to defer settlement of the liability for at least 12
months after the reporting period

Forms of statement of financial position

Account form
Report form

Review of accounting concepts

Entity: Activities of the entity are kept separate and distinct from the activities of its owner and
all other economic entities
Monetary: Only transaction data that can be expressed in terms of money may be included in the
accounting records
Cost: Assets should be recorded at their cost
Reliability/Objectivity: Quality of accounting information that gives assurance that it is free of
error and bias
Accrual: Effects of transactions and other events are recognized when they occur and recorded in
the accounting records and reported in the financial statements of the periods to which they relate
Going concern: Entity is assumed to continue in operation long enough to carry out its objective.
Materiality: Determining if an item is important enough to likely influence the decision of a
reasonable user
Disclosure: Circumstances and events that make a difference to financial statement users should
be disclosed.
Basic accounting equation
Assets = Liabilities + Equity
Assets: Resources controlled by an entity from which future economic benefits may be derived
Liabilities: Existing debts and obligations from which economic benefits are expected to flow
from the entity
Equity: Ownership claims on total assets after deducting all the liabilities. Residual interest in the
entitys total assets. Net assets.
Income: Increase in owners equity resulting from business activities entered into for the purpose
of earning profit
Expense: Cost of assets consumed or services used in the process of earning income