As part of our Financial Reporting Assumptions and Characteristics, we need to ensure that financial statements are reported in a manner that allows readers to easily compare statements between reporting periods.
If you recall, IFRS and ASPE both refer to “comparability” as ensuring accounting policies are kept consistent from year to year, and information is presented in a manner that makes it easy for users to compare year-on-year information.
In order to ensure that readers can easily make year on year comparisons, IFRS (IAS 1) outlines that all entities should present, comparative information, by providing the prior period’s financial information in the current financial statements. IAS 1 explicitly dictates that “an entity shall present comparative information in respect of the preceding period for all amounts reported in the current period's financial statements.” (IAS 1) Furthermore, entities will need to include comparative information for “narrative and descriptive information if it is relevant to understanding the current period's financial statements.” (IAS 1)
This means that, when presenting financial statements, readers should be able to see this period’s statements along with the prior period, to enable them to compare.
At a minimum, the entity will need to present:
“two statements of financial position,
two statements of profit or loss and other comprehensive income,
two statements of cash flows and
two statements of changes in equity, and related notes.” (IAS 1)
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