ALRAQABA . ISSUE 20 19 IFRS 18 Presentation and Disclosure in Financial Statements Due to globalization and international convergence, the financial business environment has drastically evolved. Such change has posed a challenge for the International Accounting Standards Board (IASB), generating the need to improve and develop international financial reporting standards that ensure greater transparency, accountability, and efficiency. IASB believes that this step is imperative owing to the fact that the IAS 1 Presentation of Financial Statements has failed to meet the demands of financial statement users. As you may be aware, this standard does not include specific requirements for financial statements, particularly income statements, to classify all items of income and expenses of a reporting period into distinct groups or categories (e.g., operating, financing, and investing) to better communicate an entity’s financial performance. The introduction of such requirements is deemed necessary to ensure efficient presentation and classification of line items in the primary financial statements and to help provide quality information for the users. Thus, the presentation of income statements under IAS 1 is deemed less efficient than intended, as it has undermined the role of the income statement in providing a useful, structured summary of an entity’s performance as well as its income and expenses. Dr. Saud Ghassab Al-Zamanan Director of Training and International Relations Department Financial Standards Audit &
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