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Statement of Financial Position

SME Par.IFRS SMEU.S. GAAP
Scope of this section
4.1 This section sets out the information that is to be presented in a statement of financial position and how to present it. The statement of financial position(sometimes called the balance sheet) presents an entity’s assets, liabilities and equity as of a specific date—the end of the reporting period.  
Information to be presented in the statement of financial position
4.2 As a minimum, the statement of financial position shall include line items that present the following amounts:
  1. cash and cash equivalents.
  2. trade and other receivables.
  3. financial assets (excluding amounts shown under (a), (b), (j) and (k)).
  4. inventories.
  5. property, plant and equipment.
  6. investment property carried at fair value through profit or loss.
  7. intangible assets.
  8. biological assets carried at cost less accumulated depreciation and impairment.
  9. biological assets carried at fair value through profit or loss.
  10. investments in associates.
  11. investments in jointly controlled entities.
  12. trade and other payables.
  13. financial liabilities (excluding amounts shown under (l) and (p)).
  14. liabilities and assets for current tax.
  15. deferred tax liabilities and deferred tax assets (these shall always be classified as non-current).
  16. provisions.
  17. non-controlling interest, presented within equity separately from the equity attributable to the owners of the parent.
  18. equity attributable to the owners of the parent.
 For non-SEC registrants, there is limited guidance on the presentation of the balance sheet.

Unlike IFRS SMEs, deferred tax assets and liabilities are classified as current or noncurrent based on the classification of the asset or liability giving rise to the temporary difference.
4.3 An entity shall present additional line items, headings and subtotals in the statement of financial position when such presentation is relevant to an understanding of the entity’s financial position.  
Current/non-current distinction
4.4 An entity shall present current and non-current assets, and current and non-current liabilities, as separate classifications in its statement of financial position in accordance with paragraphs 4.5–4.8, except when a presentation based on liquidity provides information that is reliable and more relevant. When that exception applies, all assets and liabilities shall be presented in order of
approximate liquidity (ascending or descending).		 GAAP does not contain a requirement to present a classified balance sheet.
Current assets
4.5 An entity shall classify an asset as current when:
  1. it expects to realise the asset, or intends to sell or consume it, in the entity’s normal operating cycle;
  2. it holds the asset primarily for the purpose of trading;
  3. it expects to realise the asset within twelve months after the reporting date; or
  4. the asset is cash or a cash equivalent, unless it is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting date.
 Same.
4.6 An entity shall classify all other assets as non-current. When the entity’s normal operating cycle is not clearly identifiable, its duration is assumed to be twelve months. Same.
Current liabilities
4.7 An entity shall classify a liability as current when:
  1. it expects to settle the liability in the entity’s normal operating cycle;
  2. it holds the liability primarily for the purpose of trading;
  3. the liability is due to be settled within twelve months after the reporting date; or
  4. the entity does not have an unconditional right to defer settlement of the liability for at least twelve months after reporting date.
 Current liabilities include obligations whose liquidation is expected to require the use of items classified as current assets, or the creation of other current liabilities, and whose regular and ordinary liquidation is expected to occur within 12 months, or during the operating cycle if longer.  The result, however, is essentially the same.
4.8 An entity shall classify all other liabilities as non-current.  
Sequencing of items and format of items in the statement of financial position
4.9 This IFRS does not prescribe the sequence or format in which items are to be presented. Paragraph 4.2 simply provides a list of items that are sufficiently different in nature or function to warrant separate presentation in the statement of financial position. In addition:
  1. line items are included when the size, nature or function of an item or aggregation of similar items is such that separate presentation is relevant to an understanding of the entity’s financial position, and
  2. the descriptions used and the sequencing of items or aggregation of similar items may be amended according to the nature of the entity and its transactions, to provide information that is relevant to an understanding of the entity’s financial position.
  
4.10 The judgement on whether additional items are presented separately is based on an assessment of all of the following:
  1. the amounts, nature and liquidity of assets.
  2. the function of assets within the entity.
  3. the amounts, nature and timing of liabilities.
  
Information to be presented either in the statement of financial position or in the notes
4.11 An entity shall disclose, either in the statement of financial position or in the notes, the following subclassifications of the line items presented:
  1. property, plant and equipment in classifications appropriate to the entity.
  2. trade and other receivables showing separately amounts due from related parties, amounts due from other parties, and receivables arising from accrued income not yet billed.
  3. inventories, showing separately amounts of inventories:
    1. held for sale in the ordinary course of business.
    2. in the process of production for such sale.
    3. in the form of materials or supplies to be consumed in the production process or in the rendering of services.
  4. trade and other payables, showing separately amounts payable to trade suppliers, payable to related parties, deferred income and accruals.
  5. provisions for employee benefits and other provisions.
  6. classes of equity, such as paid-in capital, share premium, retained earnings and items of income and expense that, as required by this IFRS, are recognised in other comprehensive income and presented separately in equity.
  
4.12 An entity with share capital shall disclose the following, either in the statement of financial position or in the notes:
  1. for each class of share capital:
    1. the number of shares authorised.
    2. the number of shares issued and fully paid, and issued but not fully paid.
    3. par value per share, or that the shares have no par value.
    4. a reconciliation of the number of shares outstanding at the beginning and at the end of the period.
    5. the rights, preferences and restrictions attaching to that class including restrictions on the distribution of dividends and the repayment of capital.
    6. shares in the entity held by the entity or by its subsidiaries or associates.
    7. shares reserved for issue under options and contracts for the sale of shares, including the terms and amounts.
  2. a description of each reserve within equity.
  
4.13 An entity without share capital, such as a partnership or trust, shall disclose information equivalent to that required by paragraph 4.12(a), showing changes during the period in each category of equity, and the rights, preferences and restrictions attaching to each category of equity.  
4.14 If, at the reporting date, an entity has a binding sale agreement for a major disposal of assets, or a group of assets and liabilities, the entity shall disclose the following information:
  1. a description of the asset(s) or the group of assets and liabilities.
  2. a description of the facts and circumstances of the sale or plan.
  3. the carrying amount of the assets or, if the disposal involves a group of assets and liabilities, the carrying amounts of those assets and liabilities.
  

 

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