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Pas 1

PAS 1 provides guidelines for the preparation and presentation of financial statements. It requires entities to present a statement of financial position, a statement of profit or loss and other comprehensive income, and a statement of changes in equity. The financial statements aim to provide useful information to a wide range of users for economic decision-making and show the results of management's stewardship over the entity's resources.

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BUQUIRAN, MARY JOY
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304 views7 pages

Pas 1

PAS 1 provides guidelines for the preparation and presentation of financial statements. It requires entities to present a statement of financial position, a statement of profit or loss and other comprehensive income, and a statement of changes in equity. The financial statements aim to provide useful information to a wide range of users for economic decision-making and show the results of management's stewardship over the entity's resources.

Uploaded by

BUQUIRAN, MARY JOY
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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pp.

110
PAS 1-Philippine Accounting Standard
-It applies to the preparation and presentation of general purpose financial statements.
- the terminology use in PAS 1 is suitable for profit oriented entities.
- it requires profit or loss, other comprehensive income, and comprehensive income
Presentation of Financial Statements- to ensure comparability

TYPES OF COMPARABILITY
a. Intra-comparability(horizontal or inter-period)- refers to comparability of FS of same entity
b. Inter-comparability(dimensional)- refers to the comparability of FS between different entities.

FINANCIAL STATEMENTS
-are the “structed representation of an entity`s financial position and result of it’s operations.”
-end product of reporting process

General purpose financial statements- are “those intended to meet the needs of users who are not in a position to require
entity to prepare reports tailored to their information needs”
-cater to most of the common needs of a wide range of external users.
-are the subject matter of the CFAS.

PURPOSE OF FINANCIAL STATEMENTS


1. Primary objective: To provide information about the financial position, financial performance, cash flows of an entity
that is useful to a wide range of users in making economic decisions.
2. Secondary objective: To show the results of management’s stewardship over the entity’s resources.

To meet the objective, financial statements provide information about an entity’s:


a. Assets
b. Liabilities
c. Equity
d. Income
e. Expenses
f. Contributions by, and distributions to, owners; and
g. Cash flows
“Balance sheet” in lieu of “statement of financial position” or “statement of comprehensive income” instead of “
statement of profit or loss and other comprehensive income”

Income statement is different from “statement of comprehensive income” or “ statement of profit or loss and other
comprehensive income”
PAS 1 does not prescribe the order or format of presenting items in the statement of financial position.
PRESENTATION OF STATEMENT OF FINANCIAL POSITION
a. Classified presentation shows distinctions between current and non current assets and current and noncurrent
liabilities.
b. Unclassified presentation (also called based on liquidity) shows no distinction between current and noncurrent
items.
c. Mixed presentation which presenting some assets and liabilities using a current/non-current classification and
others in order of liquidity.
Reclassification adjustments “are amounts reclassified to profit or loss in the current period that were recognized on
other comprehensive income in the current or previous periods.

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