Journal of Positive School Psychology http://journalppw.

com
2022, Vol. 6, No. 3, 2343–2354
The Five Financial Statements based on IFRS and How They are Prepared
Caroline1 , Syafa Davy Baihaqi S.2 , Iskandar Muda3
1,2,3
Universitas Sumatera Utara, Medan, Indonesia

Abstract.

Companies must have financial statements that are useful for disclosing information on the
financial condition of a company. Financial statements reflect the form of management's
responsibility in using the resources entrusted to manage an entity. According to IFRS, there
are 5, namely Income Statement which aims to determine the profit or loss of a company,
Statement of change in Equity which aims to determine changes in the capital of a company
within a certain period, Statement of Financial Position which aims to show the financial
position of a company in a period, Statement of Cash Flow which aims to provide
information related to cash receipts and disbursements of a bookkeeping, and the last
Noted to Financial Statement which is useful for containing information that usually
descriptive in nature, relating to general company information.

Keywords : Financial Statement, Income Statement, Statement of Change in Equity,

Statement of Financial Position, Statement of Cash Flow, Noted to Financial Statement

1. INTRODUCTION 4. Changes that occur in the company's assets,

liabilities, and capital.
The financial report of a company is a document 5. The performance of the company's
used to analyze the financial performance and management and records of the company's
position of an entity so that it can provide financial statements in a certain period.
information about the financial position. Financial
reports are used by stakeholders, including Financial reports that are generally prepared by
shareholders, investors, \customers, suppliers, companies are divided into five types of reports
governments, stock exchanges, and other relevant and are provided sequentially, including:
stakeholders. According to Tibiletti et al (2021), 1. Income Statement, is a summary of income
financial statements are the result of the and expenses for a certain period of time.
accounting process that is used as a means of 2. Statement of Owner's Equity, is the amount
communicating between data or financial of change in owner's equity that occurred
activities of a company and the parties with an during a certain period of time.
interest in the company. 3. Statement of Financial Position, is the
number of assets, liabilities, and owner's
According to Ni Kadek, et al, financial statements equity at a certain time period.
aim to provide information related to the financial 4. Statement of Cash Flows, is a summary of
position (balance sheet), company performance cash receipts and payments for a certain
(income statement), and changes in the financial period of time.
position of a company that is useful for a large 5. Other notes and reports as well as
number of users in making economic decisions. explanatory materials that are part of the
The financial statements reflect the form of financial statements.
management's responsibility in using the
resources entrusted to manage an entity. In this journal, we will discuss the five types of
financial statements and provide examples of how
The purpose of financial statements is to provide to prepare a company's financial statements
various information, including: according to IFRS rules.
1. Type and amount of assets (assets), liabilities
and capital owned by the company at this 2. LITERATURE REVIEW
time 2.1. Income Statement
2. The type and amount of income earned by
the company in a certain period. The income statement reports three main financial
3. Total costs and types of costs incurred by the information namely income, expenses, and profit
company in a certain period.
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2344 Journal of Positive School Psychology

or loss for a certain period of time. The usefulness The statement of changes in equity is presented to
of the income statement, including: show:
1. Source of information for investors and 1. Profit or loss in the related period
creditors to forecast the amount, timing and 2. Revenues and expenses recognized in equity
uncertainty of future cash flows in several 3. The effect of changes in accounting policies
ways, namely: and error correction on each component of
a. Evaluating the company's past equity
achievements. 4. Reconciliation between the beginning and
b. Determine the risk (level of uncertainty) of end of the period carrying amounts are
failure to achieve the target. disclosed separately.
2. Assessment for customers determines the
company's ability to meet the demand for 2.3. Statement of Financial Position
goods and services needed.
The balance sheet is a systematic report consisting
The income statement has two forms, namely of assets, liabilities and capital of the company for
1. Multiple Steps, the form of an income a certain period (Ramadhani et al., 2021). The
statement that performs several groupings on balance sheet is also called the statement of
income and expenses that are neatly arranged financial position because it shows the net worth
so that net income can be calculated of a company.
2. Single Step, this form is simpler where only
separated between : The purpose of a balance sheet is to show the
a. Revenues and profits financial position of a company over a period,
b. Costs and losses usually at the end of a fiscal year or calendar year.
The balance sheet in financial statements provides
The Income Statement Components consist of: a useful basis for:
1. Sales revenue 1. Calculating the rate of return
2. Cost of goods sold 2. Assess the company's capital structure
3. Gross profit 3. Establish liquidity and financial flexibility
4. Operating Expenses
5. Operating Profit Assets, Debt, and Capital are the there parts of
6. Other Income and Benefits balance sheet (Putra, 2020). Below is the
7. Other Expenses and Losses explaination if the three part of Balance Sheet:
8. Profit from Continuing Operations before 1. Assets are assets or assets (tangible and
Income Tax intangible assets) owned, including expenses
9. Income Tax on Continuing Operations that have not been allocated or costs that will
10. Profit from Continuing Operations be allocated in the future, and are divided
11. Discontinued Operation into:
12. Amazing Posts a. Current assets are cash and other assets
13. Net Profit and Loss that can be liquidated or sold within one
14. Earnings per Share year.
b. Fixed assets are assets that are
2.2. Statement of Change in Equity physically visible (concrete) and are
used in operations, are permanent and
Statement of changes in capital is a type of cannot be used up in one cycle of
financial report that shows changes in the capital activity or one year.
of a business in a certain period, which includes c. Intangible fixed assets are assets that are
comprehensive income, investments and not physically visible, but have value
distributions to and from owners. This report is and are used in company activities.
made after the income statement but is made d. Other assets
before the balance sheet, because the data used are 2. Debt is the company's obligations to other
related to each other. The results of the income parties related to unfulfilled finances
statement become initial data for the Statement of originating from creditors (Safira et al.,
Changes in Capital, while the results of the 2020). Debts or liabilities can be divided
calculation of capital at the end of the period into:
become data for the Balance Sheet. a. Current liabilities/short term debt are
financial obligations which are repaid

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Caroline1, et. al. 2345

within one year from the balance sheet 2. Investment Activities

date. Relates to the receipt and disbursement of
b. Long-term debt is a financial obligation cash resources aimed at increasing future
whose repayment period exceeds one income and cash flows. Examples of
year. transactions that are included in investment
3. Capital is the right or property of the owner activities include:
of the company which is allocated for the a. Cash payments to purchase property,
sustainability of the company. plant and equipment, intangible assets,
non-current assets, including
2.4. Statement of Cash Flow development costs and self-constructed
fixed assets, and purchase debt
According to Sofyan Syafari Harahap (2006), instruments or equity instruments
cash flow is a report that provides information (investments in bonds or stocks)
related to receipts and expenses of a bookkeeping b. Cash receipts from the sale of fixed
by classifying transactions in operational, assets, debt instruments and equity
financing and investment activities. instruments
3. Funding Activities
According to Donald E. Kieso et al (2008), the In relation to liability and owner's equity
cash flow statement reports receipts, payments items which include:
and net changes in cash originating from a. acquisition of capital from the owner
operating, investing, and financing activities and compensation with a return on
during a certain period in a format that reconciles investment value
the ending cash balance. b. borrowing money from creditors and
paying debts
The benefit of the cash flow statement is to know Examples of transactions in financing
the cash and non-cash transactions that occur and activities, including:
to know the company's ability to: a. Cash receipts from the issuance of
1. Generate cash in the future, shares, bonds, loans, notes, mortgages,
2. Paying dividends, and or other instruments and capital
3. Pay off obligations / debts. b. Cash payments to shareholders to
redeem company shares
There are three classifications of activities in cash c. Cash payments by the lessee relating to
flow, including: finance leases
1. Operational Activities d. Loan repayment
is the main income generating activity of the
company that affects cash flows from 2.5. Noted to Financial Statement
transaction events or other conditions that
affect the income statement. Sometimes one The notes to the financial statements provide
type of transaction can affect several additional information needed by creditors or
activities, such as sales of fixed assets which shareholders regarding the accounting methods
are included in investment activities and used in recording financial statements. The
operating activities because the resulting additional information is descriptive in nature and
profits affect profit and loss. is reported in narrative form so that it is not found
Examples of cash flows from operating in the basic financial statements.
activities include:
a. Cash receipts from royalties, fees, sales The Indonesian Institute of Accountants (2004)
of goods and services, commissions, adds that the notes to financial statements must be
rentals and sales of assets, and other presented economically where each item in the
income balance sheet, related to the budget realization
b. Cash payments related to taxes, supply report and cash flow statement, must be in
of goods and services, manufacturing or accordance with the information in the notes to
to acquire assets, as well as to the financial statements.
employees
c. Cash receipts and payments related to Basic financial statement documents have
trade and insurance contracts different functions for different types of
d. And others related to operations businesses, including for:

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2346 Journal of Positive School Psychology

1. Company: shows the changes made to the

company's share capital, retained earnings, The methods of making each type of financial
and accumulated reserves report that are usually prepared and presented in
2. Sole trader: shows the change in owner's each report include:
equity.
3. Partnership: shows the change between the 3.1. Income Statement
equity of the two partners.
The income statement consists of elements of
Types of records that are usually attached by income and elements of operating expenses where
management as supporting data, namely: operating income is reduced by operating
1. Information regarding the details of the expenses will generate operating profit.
balance sheet, figures presented in the notes
to the financial statements, both in the form “Net Profit = Operating Income –
of numerical data and descriptive data (in Operating Expenses”
narrative form) and is the type of record that
is most often used. Quantitative data in the Details:
financial statement records is useful in 1. Income is the increase in wealth received
supporting the total amount data in the from an activity, for example from the sale of
balance sheet. products or services. Revenue can come
2. Summary of accounting policies, containing from:
information on accounting principles and a. Operating revenues
methods applied in the preparation of the b. Rental Income
company's financial statements. This c. Interest income
information should be disclosed to users and 2. Expenses are sacrifices that must be made to
become an integral part of the financial obtain goods and services used in one period.
statements. The load consists of:
3. Information on items that cannot be reported, a. Salary expense
because they fail to meet the recognition b. Advertising expenses
criteria to be recorded in the financial c. Office Rental Expenses
statement accounts, but are still considered d. Utility Load
significant for users of financial statements in e. Miscellaneous Burden
the decision-making process 3. Net Profit is the profit earned from operating
4. Other complementary information, including income minus operating expenses.
information on the company's business
segments, for example information on market The following are examples / illustrations of the
segments, and so on. two types of income statements, including:

3. METHODS 1. “Single Step”

“Net Income = (Revenue + Profit) – (Expense + Loss)”

Income statement

Operating revenues IDR XXXX

Interest Profit IDR XXXX +
Total Income IDR XXXX

Cost of Materials IDR XXXX

Operating Expenses IDR XXXX
Building Rental Expenses IDR XXXX
Incidental Losses IDR XXXX +
Total Operating Expenses IDR XXXX -

Net Income IDR XXXX

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Caroline1, et. al. 2347

2. “Multiple Step”

“Gross profit = Net sales – Cost of Goods Sold”

“Operating income = Gross Profit – Operating Expenses”

“Net income = Operating Income – Non-Operating Items”

Income statement

Gross Sales Revenue IDR XXXX

Return IDR XXXX -
Net Sales Revenue IDR XXXX
Cost Of Materials IDR XXXX -
Gross Profit On Sales IDR XXXX
Operating Expenses:
Administrative Burden IDR XXXX
Selling expenses IDR XXXX +
Total Operating Expenses IDR XXXX -
Operating Income IDR XXXX
Non-Operational Expenses
Building Rental Expenses IDR XXXX -
Net Income IDR XXXX

3.2. Statement of Change in Equity Definitive Funds

xxxxx
The statement of changes in equity consists of
elements of initial capital, net income, prive. Details :
1. Capital is the prosperity of the owner's
Capital Change company that is invested or deposited into
Initial Funds the company he owns
xxxxx 2. Net Profit is the deviation between income
Net Profit xxxxx earned and operating expenses incurred
Prive xxxxx 3. Prive is the withdrawal of company money
for the personal interest of the company
Capital Growth owner.
xxxxx +
In general, the Statement of Financial Position
3.3. Statement of Financial Position report contains three elements of information,
namely assets, liabilities and company capital.

“Assets = Liabilities + Equity”

Details :
1. Examples of Corporation Assets include:
a. Cash
b. Accounts receivable
c. Office supplies
d. Prepaid insurance
e. Office equipment
2. Examples of Obligations include:
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2348 Journal of Positive School Psychology

a. Accounts payable
b. Rent Accepted In Advance
3. Equity contains information that records the resources supported by the owner and invested in the entity
by recording the accumulated gain or loss.

In preparing the Statement of Financial Position, it is divided into 2 sides, namely the asset side and the
liability side. The asset side is a list of assets owned by the company at a certain time, while the passive side
is the source from which these assets are obtained. The sources of wealth consist of 2 major groups, namely
debt and capital. Therefore, the number of assets and passives must always be the same and in balance..
Statement of Cash Flow

Cash flow is a breakdown that shows the amount of income and expenses in a certain period. there are 3
components in cash flow, namely:
1. Operating Activities Cash Flow
2. Investment Activities Cash Flow

Statement of Financial Position

Asset Liabilities + Equity
Current Assets Liabilities
Trading Supplies Land And Building Tax Debt
Current Fund Employee Incentives/Bonuses
Fixed Assets Vehicle Loans
Soil
Building Equity
Vehicle Owner's Funds
Office Equipment Retained Profit
Intangible Fixed Assets +
Copyright
Business Permit
Other Assets
Current Fund

Total Asset = IDR ABCD Total Liabilities + Equity = IDR ABCD

Funding Activities Cash Flow

These are the steps to make a cash flow report

CASH FLOW STATEMENT
Cash Flow from Operating Activities
Cash In from Income xxx
Cash Out of Expenses (xxx) -
Net Cash from Operating Activities xxx
Cash Flow from Investing Activities
Land Purchase xxx
Equipment Purchase xxx +
Net Cash from Investing Activities xxx -
Cash Flow from Funding Activities
Owner's Investment xxx
Prive xxx -
Net cash from Funding Activities xxx +
Final Cash xxx

3.4. Noted to Financial Statement

Notes to this Financial Statement contain general business along with information on calculation
information related to the reported company/ methods that need to be additional notes for

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Caroline1, et. al. 2349

stakeholders in order to understand more clearly 4.1 Result

the readings of the Company's Financial The following is an example of a trial
Statements. balance from the stationery company PT ABC
4. RESULT AND DISCUSSION during February 2022 in the current year.

Adjusted Trial Balance

No Account
Debet Credit
1 Cash IDR 11.650.000
2 Account Receivable IDR 1.825.000
3 Merchandise Inventory IDR 4.000.000
4 Supplies IDR 3.700.000
5 Prepaid Rent IDR 11.000.000
6 Equipment IDR 18.000.000
7 Accumulated Depreciation - Equipment IDR 11.100.000
8 Vehicle IDR 6.000.000
9 Account Payable IDR 20.200.000

10 Equity IDR 21.000.000

11 Income Summary

12 Sales IDR 22.275.000

13 Purchase IDR 5.000.000

14 Salaries Expense IDR 3.000.000

15 Utilities Expense IDR 600.000
16 Rent Expense IDR 1.000.000
17 Supplies Expense IDR 5.300.000
18 Depreciation of Vehicle Expense IDR 100.000
19 Accumulated Depreciation - Vehicle IDR 100.000
20 Depreciation of Equipment Expense IDR 300.000

From the trial balance, a financial report for PT ABC can be compiled for the month of February 2022.

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2350 Journal of Positive School Psychology

1. Income Statement

PT ABC
Income Statement
February 28,2022

Sales IDR 22.275.000

Cost Of Good
Sold
Merchandise Inventory,
Feb 1 IDR 7.200.000
Purchase IDR 5.000.000
Merchandise Inventory,
Feb 28 IDR 4.000.000
Cost of Good Sold IDR 8.200.000
Gross Profit on Sales IDR 14.075.000
Expenses

Rent Expense IDR 1.000.000

Supplies Expense IDR 5.300.000

Salaries Expense IDR 3.000.000

Utilities Expense IDR 600.000

Depreciation of Vehicle
IDR 100.000
Expense
Depreciation of Equipment
IDR 300.000
Expense
Total Expenses IDR 10.300.000
Net Income IDR 3.775.000

2. Statement of Change in Equity

PT ABC
Statement of Equity
February 28,2022

Capital Beginning IDR 21.000.000

Add : Net
IDR 3.775.000
Income
Capital Ending IDR 24.775.000

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Caroline1, et. al. 2351

3. Statement of Financial Position

PT ABC
Statement of Financial Position
February 28,2022
Assets Liabilities & Equity
Cash IDR 11.650.000 Liabilities
Account Receivable IDR 1.825.000 Account Payabe IDR 20.200.000
Merchandise
IDR 4.000.000
Inventory
Supplies IDR 3.700.000
Prepaid Rent IDR 11.000.000
Equipment IDR 18.000.000
Less : Accumulated
Depreciation - IDR (11.100.000) IDR 6.900.000
Office Equipment

Vehicle IDR 6.000.000

Less : Accumulated Equity IDR 24.775.000
Depreciation -
IDR (100.000) IDR 5.900.000
Office Equipment

Total Assets IDR 44.975.000 Total Liabilities & IDR 44.975.000

Equity

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2352 Journal of Positive School Psychology

4. Cash Flow Statement

PT ABC
Cash Flow Statement
February 28,2022

Operations
Cash receipts from
Cash from Customers IDR 20.450.000
Cash paid for
Inventory Purchase IDR 1.000.000
Prepaid Rent IDR 12.000.000
Advertising Expense IDR 200.000
Supplies IDR 4.500.000
Utilities Expense IDR 600.000
Salaries Expense IDR 3.000.000
Account Payabale IDR 1.500.000 IDR 22.800.000
Net Cash Flow from Operations IDR (2.350.000)

Investing Activities
Cash Paid For
Vehicle IDR (6.000.000)

Net Cash Flow from Investing Activities IDR (6.000.000)

Increase (Decrease) from Cash IDR (8.350.000)
Cash Beginning IDR 20.000.000
Cash Ending IDR 11.650.000

5. Noted to Financial Statement

PT ABC
Noted to Financial Statement
February 28,2022
1. General Information
PT ABC is a company engaged in the production of stationery.
PT ABC's vision: to be a company that provides the highest quality and
international standard stationery
PT ABC's mission
1. Integrating human and natural resources to produce quality products
2. Prioritizing customer satisfaction

PT ABC

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Caroline1, et. al. 2353

Noted to Financial Statement (Continue)

February 28,2022
2. Overview of Important Accounting Policies
A. Financial reports are prepared in accordance with IFRS (International
Financial Reporting Standards).
B. Cash and cash equivalents include cash.
C. Revenue is recognized based on the delivery of goods to the buyer. Expenses
are recognized when incurred.
D. Assets consist of cash, trade receivables. Liabilities consist of bank loans.
E. Fixed assets, equipment and vehicles are depreciated using the straight-line
method with an economic life of 5 years.
From the report, it can be seen that
the company's cash decreased by
4.2 Discussion IDR 8.350.000. This decrease came
from operations, decreased by IDR
The financial report is a document used 2.350.000 and from investment
to analyze the performance and position activities by IDR 6.000.000
of an entity to provide information about 5. Notes to financial statements
the financial statement. Preparing the From the report, we know the
financial statements, PT ABC made an general description, and the
adjusted trial balance for February 2022. methods used by the company in
From the trial balance, the financial making financial statements.
statements were obtained, namely:
1. Profit/Loss Report
From this report, during February
PT ABC earned a profit of IDR 4. CONCLUSSION
3.775.000. This profit was obtained
from the company's total sales of There are five types of financial
IDR 22.275.000 less Cost of Good statements that are usually used by
Sold of IDR 8.200.000 and companies or business units as
Expense from Operation of information for stakeholders in knowing
IDR 10.300.000. the company's current financial position
2. Capital change report and for forecasting cash flows in the
From the report, it can be seen that future according to the IFRS version,
there was an increase in the namely:
company's capital of IDR 3.775.000 1. The Income Statement is used to
came from net income. find out the profit of a business by
3. Statement of financial position deducting operating income by
From the report, it can be seen that operating expenses.
the amount of assets owned by the 2. Report on changes in capital is a
company is IDR 44.975.000 which report showing changes in capital
consists of cash, accounts of a business in a certain period
receivable, merchandise inventory, which includes comprehensive
supplies, prepaid rent, equipment, income, investment, and
and vehicles. Meanwhile, the distributions to and from company
amount of liability is IDR owners. This report is made by
20.200.000 and the amount of means of capital plus the difference
equity is IDR 24.775.000. between profit and private.
4. Cash flow statement 3. Statement of financial position has
three main components where the

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2354 Journal of Positive School Psychology

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