Updated Standard No. 37: Financial Instruments: Disclosure;
The requirements of these standards are valid for all financial statements whose financial period starts from 01/01/2018 onwards.
It is noted that Accounting Standard 35 titled “Income Tax” whose purpose is to prescribe the method of accounting for income tax, that the requirements of this standard are effective from 01/01/2019 onwards.
The implementation of standard one (approved in 2017) entitled “presentation of financial statements” leads to the abandonment of accounting standard 14 entitled “how to present current assets and current liabilities”. Also, with the simultaneous implementation of this standard and Accounting Standard 34 entitled “Accounting Procedures, Changes in Accounting Estimates and Mistakes”, Accounting Standard 6 entitled “Financial Performance Report” will be abandoned. (According to paragraph 141 of Standard I)
According to paragraph 9 of Standard No. 1, the number of basic financial statements has increased from four financial statements to five financial statements, and the complete set of financial statements includes the following:
• Financial statement (balance sheet) as of the end of the period
• Profit and loss statement for the period
• Comprehensive income statement for the period
• Statement of changes in ownership rights for the period
• Statement of cash flows for the period
• Explanatory notes, including important accounting procedures and other explanatory information
• Comparative information of the previous period according to paragraphs 36 and 37 of the accounting standard
Thus, the changes made in the way of presenting financial statements since 2018 are as follows:
• A new financial statement called statement of changes in equity has been added to the financial statements.
• The arrangement of the financial statements has also been changed, the profit and loss statement is presented before the balance sheet.
• The name of the balance sheet has been changed to financial status.
• In the previous financial statements, the balance sheet was presented in the form of T, while in the new financial statements, the items of the financial statement or the balance sheet are placed in the form of columns below each other, and the priority of placing the items is such that the items that have less liquidity They are placed in higher rows.
• An important point in the profit and loss statement is that income tax is considered as income tax expense in this financial statement.
• The cash flow statement was reduced from five levels to three levels.
Mehdi Koh Soltani (financial services, accounting, financial and tax consultant):
Link to the audit accounting clinic
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