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[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section admin_label=”Section” fullwidth=”off” specialty=”off”][et_pb_row admin_label=”Row”][et_pb_column type=”1_2″][et_pb_text admin_label=”Text” background_layout=”light” text_orientation=”center” text_font_size=”14″ use_border_color=”off” border_color=”#ffffff” border_style=”solid”] [button link=”http://www.frs102.com/members/premium-toolkit/” type=”big” color=”red”] Return to Main Index[/button] [/et_pb_text][/et_pb_column][et_pb_column type=”1_2″][et_pb_text admin_label=”Text” background_layout=”light” text_orientation=”center” text_font_size=”14″ use_border_color=”off” border_color=”#ffffff” border_style=”solid”] [button link=”https://uk.frs102.com/members/premium-toolkit/section-5/” type=”big” color=”red”] Return to Section 5 Home[/button] [/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section admin_label=”Section” fullwidth=”off” specialty=”off” transparent_background=”off” allow_player_pause=”off” inner_shadow=”off” parallax=”off” parallax_method=”off” padding_mobile=”off” make_fullwidth=”off” use_custom_width=”off” width_unit=”on” make_equal=”off” use_custom_gutter=”off” gutter_width=”3″][et_pb_row admin_label=”Row”][et_pb_column type=”4_4″][et_pb_text admin_label=”Main Body Text” background_layout=”light” text_orientation=”justified” use_border_color=”off” border_color=”#ffffff” border_style=”solid”]

Presentation of total comprehensive income

Extract from FRS102: Section 5.2-5.3

5.2 An entity shall present its total comprehensive income for a period either:

(a) in a single statement of comprehensive income, in which case the statement of comprehensive income presents all items of income and expense recognised in the period; or

(b) in two statements—an income statement (which is referred to as the profit and loss account in the Act) and a statement of comprehensive income—in which case the income statement presents all items of income and expense recognised in the period except those that are recognised in total comprehensive income outside of profit or loss as permitted or required by this FRS.

5.3 A change from the single-statement approach to the two-statement approach, or vice versa, is a change in accounting policy to which Section 10 Accounting Policies, Estimates and Errors applies.

OmniPro comment

Entities have a choice to apply:

See example of each of these below. The layout should follow Company law requirements.

Single-statement approach

Extract from FRS102: Section 5.5-5.6, Section 5.7D and Section 5.9.

5.5 An entity shall present, in the statement of comprehensive income, the items to be included in a profit and loss account in accordance with one of the following requirements:

(a) Part 1 General Rules and Formats of Schedule 1 to the Regulations;

(b) Part 1 General Rules and Formats of Schedule 2 to the Regulations;

(c) Part 1 General Rules and Formats of Schedule 3 to the Regulations; or

(d) Part 1 General Rules and Formats of Schedule 1 to the LLP Regulations.

The consolidated statement of comprehensive income of a group shall be presented in accordance with the requirements for a consolidated profit and loss account of Schedule 6 to the Regulations or Schedule 3 to the LLP Regulations.

5.5A In addition an entity shall include, in the statement of comprehensive income, line items that present the following amounts for the period:

(a) Classified by nature (excluding amounts in (b)), the components of other comprehensive income recognised as part of total comprehensive income outside profit or loss as permitted or required by this FRS. An entity may present the components of other comprehensive income either:

(i) net of related tax effects; or

(ii) before the related tax effects with one amount shown for the aggregate amount of income tax relating to those components.

(b) Its share of the other comprehensive income of associates and jointly controlled entities accounted for by the equity method.

(c) Total comprehensive income.

5.6 An entity shall present the following items as allocations of profit or loss and other comprehensive income in the statement of comprehensive income for the period:

(a) Profit or loss for the period attributable to:

(i) non-controlling interest; and

(ii) owners of the parent.

(b) Total comprehensive income for the period attributable to:

(i) non-controlling interest; and

(ii) owners of the parent.

5.7D In addition to the requirements of paragraphs 5.5 or 5.7, as a minimum, turnover must be presented on the face of the income statement (or statement of comprehensive income if presented).

5.9 An entity shall present additional line items, headings and subtotals in the statement of comprehensive income (and in the income statement, if presented), when such presentation is relevant to an understanding of the entity’s financial performance.

OmniPro comment

The above references are to the UK Companies Act. The relevant references to the Irish Companies Acts with regard to the profit and loss layout are:

Format 1 Profit and loss format – Schedule 3 of Companies Act 2014

Format 2 Profit and loss format – Schedule 3 of Companies Act 2014

Format 3 Profit and loss format – Schedule 3 of Companies Act 2014

Format 4 Profit and loss format – Schedule 3 of Companies Act 2014

It is evident from the above that the income statement can be called a profit and loss account or statement of comprehensive income. The profit and loss should follow the layout of the Companies Act or can be laid out in the format in Section 5.5B and Section 5.5C. Section 5.5B and 5.5C relates to a different choice as to what format the profit and loss account can be presented in. This is not applicable for companies registered in the Republic of Ireland at this time as the EU directive 2013/34 has not been enacted. UK companies can currently use this layout if they wish, providing they have then adopted the amendments made to FRS 102 in September 2015. This is not specific to small companies. Section 5.5B and Section 5.5C have been discussed in the section titled ‘Alternative profit and loss format as set out below in example 4.

The single statement approach shows the profit and loss as one document and includes the statement for comprehensive income.

Other comprehensive income relate to items of income and expenses that are not recognised in the profit and loss as required or permitted by FRS 102.


Example 1: Example of Single statement approach for a Group

Consolidated Statement of Comprehensive Income

 

 

 

For the year ended 31 December 2015

 

 

 

 

            Notes

              2015

             2014

 

 

                 CU

                CU

Turnover

                   1

            XXXXX

           XXXXX

Cost of sales

 

            (XXXX)

           (XXXX)

Gross profit

 

              XXXX

             XXXX

Selling and distribution costs

 

             (XXX)

             (XXX)

Administrative expenses

 

             (XXX)

             (XXX)

Other operating income

 

                XXX

               XXX

Group operating profit

                   3

               XXX

               XXX

Share of profit in associates

                   4

               XXX

               XXX

Share of profit in joint venture

                   5

                XXX

               XXX

Profit

 

              XXXX

             XXXX

Interest receivable and similar income

                   6

               XXX

               XXX

Interest payable and similar income

                   7

             (XXX)

             (XXX)

Profit before taxation

 

              XXXX

             XXXX

Tax on profit on ordinary activities

                   8

              (XXX)

             (XXX)

 

 

 

 

Profit for the financial year

 

        1,000,00

        500,000

Other comprehensive income:

Exchange differences on retranslation of foreign operations

XXX

              XXX

Group cash flow hedges

 

 

-effective portion of changes in fair value to cash flow hedges

9                  XXX

              XXX

-fair value of cash flow hedges transferred to income statement

10                XXX

              XXX

Actuarial loss in respect of the defined pension scheme

11               (XXX)

            (XXX)

Gain/(loss) on revaluation of intangible assets

12                 XXX

            (XXX)

Gain/(loss) on revaluation of property, plant and equipment

13                 XXX

            (XXX)

Gain/(loss) on revaluation of subsidiaries, associates, etc.

14                 XXX

            (XXX)

Deferred tax on components of other comprehensive income

15                 XXX

              XXX

Total other comprehensive income for the year net of tax

    200,000

     (100,000)

Total comprehensive income for the year

1,200,000

       400,000

 

Total comprehensive income for the financial year attributable to:

Non-controlling interests

 

XXXX

 

XXXX

 

 

 

Owners of the parent company

           XXX

               XXX 

 

      1,200,000

         400,000

Profit for the financial year attributable to:

Non-controlling interests

 

XXXX

 

XXXX

 

 

 

Owners of the parent company

             XXX

               XXX

 

      1,000,000

         500,000


Example 2: Example of Single statement approach for an individual entity (i.e. not group accounts)

Statement of Comprehensive Income

 

 

 

For the year ended 31 December 2015

 

 

 

 

            Notes

              2015

              2014

 

 

                 CU

                CU

Turnover

                   1

        XXXXX

       XXXXX

Cost of sales

 

            (XXXX) 

           (XXXX)

Gross profit

 

              XXXX

              XXXX

Selling and distribution costs

 

             (XXX)

             (XXX)

Administrative expenses

 

             (XXX)

             (XXX)

Other operating income

 

               XXX

               XXX

Operating profit

                   3

               XXX

               XXX

Income from shares in group undertakings

                   4

               XXX

               XXX

Income from shares in other financial assets

                   4

               XXX

               XXX

Income from shares in participating interests

                   5

                XXX

                XXX

Profit before interest and taxation

 

              XXXX

              XXXX

Interest receivable and similar income

                   6

               XXX

               XXX

Interest payable and similar income

                   7

             (XXX)

             (XXX)

Profit before taxation

 

              XXXX

              XXXX

Tax on profit on ordinary activities

                   8

               (XXX)

           (XXX) 

Profit for the financial year

 

        1,000,00

         500,000

 

cash flow hedges

 

 

–     effective portion of changes in fair value to cash flow hedges

  9            XXX

               XXX

–     fair value of cash flow hedges transferred to income statement

10            XXX

               XXX

Actuarial loss in respect of the defined pension scheme

11          (XXX)

             (XXX)

Gain/(loss) on revaluation of intangible assets

12            XXX

             (XXX)

Gain/(loss) on revaluation of property, plant and equipment

13            XXX

             (XXX)

Gain/(loss) on revaluation of subsidiaries, associates, etc.

14            XXX

             (XXX)

Deferred tax on components of other comprehensive income

15            XXX

               XXX

Total other comprehensive income for the year net of tax

         200,000

      (100,000)

Total comprehensive income for the year

      1,200,000

         400,000

 

Total comprehensive income for the financial year attributable to:

 

 

Owners of the parent company

    1,200,000 

         400,000

 

      1,200,000

         400,000

Profit for the financial year attributable to:

 

 

Owners of the parent company

   1,000,000

        400,000

 

      1,000,000

         500,000


 

Two-statement approach

Extract from FRS102: Section 5.7-5.7D and Section 5.9

5.7 Under the two-statement approach, an entity shall present in an income statement, the items to be included in a profit and loss account in accordance with one of the following requirements:

(a) Part 1 General Rules and Formats of Schedule 1 to the Regulations;

(b) Part 1 General Rules and Formats of Schedule 2 to the Regulations;

(c) Part 1 General Rules and Formats of Schedule 3 to the Regulations; or

(d) Part 1 General Rules and Formats of Schedule 1 to the LLP Regulations.

The consolidated income statement of a group shall be presented in accordance with the requirements for a consolidated profit and loss account of Schedule 6 to the Regulations or Schedule 3 to the LLP Regulations.

5.7A An entity choosing to apply paragraph 1A(2) of Schedule 1 to the Regulations and adapt one of the profit and loss account formats shall, as a minimum, include in its income statement line items that present the amounts in paragraphs 5.5B(a) to 5.5B(g), with profit or loss as the last line. The statement of comprehensive income shall begin with profit or loss as its first line and shall display, as a minimum, line items that present the amounts in paragraphs 5.5B(h) to 5.5B(j) and paragraph 5.6(b) for the period, with total comprehensive income as the last line.

5.7B If an entity presents profit or loss in an income statement, it shall present the information required in paragraph 5.6(a) in that statement.

5.7C The statement of comprehensive income shall begin with profit or loss as its first line and shall display, as a minimum, line items that present the amounts in paragraphs 5.5A and 5.6(b) for the period.

5.7D In addition to the requirements of paragraphs 5.5 or 5.7, as a minimum, turnover must be presented on the face of the income statement (or statement of comprehensive income if presented).

5.9 An entity shall present additional line items, headings and subtotals in the statement of comprehensive income (and in the income statement, if presented), when such presentation is relevant to an understanding of the entity’s financial performance.

OmniPro comment


Example 3: Two statement approach for a Group

Consolidated Profit and Loss Account

 

 

 

For the Year Ended 31 December 2015

 

 

 

 

            Notes

              2015

              2014

 

 

                CU

                CU

Turnover

                   1

            XXXXX

            XXXXX

Cost of sales

 

            (XXXX)

           (XXXX)

Gross profit

 

              XXXX

              XXXX

 

 

 

 

Selling and distribution costs

 

              (XXX)

             (XXX)

Administrative expenses

 

             (XXX)

             (XXX)

Other operating income

 

               XXX

               XXX

Group operating profit

                   3

               XXX

               XXX

 

 

 

 

Share of profit in associates

                   4

               XXX

               XXX

Share of profit in joint venture

                   5

                XXX

                XXX

Profit on ordinary activities before interest and taxation

 

              XXXX

              XXXX

 

 

 

 

Interest receivable and similar income

                   6

               XXX

               XXX

Interest payable and similar income

                   7

         (XXX)

             (XXX) 

Profit on ordinary activities before taxation

 

              XXXX

              XXXX

 

 

 

 

Tax on profit on ordinary activities

                   8

   (XXX) 

            (XXX)

 

 

 

 

Profit for the financial year

 

      1,000,000

         500,000

 

Profit for the financial year attributable to:

 Non-controlling interests

 

XXXX

 

XXXX

Owners of the company

              XXX

              XXX

 

      1,000,000

         500,000

SEPARATE PAGE IN THE FINANCIAL STATEMENTS INCLUDE:

Consolidated Statement of Comprehensive Income

Profit for the financial year

      1,000,000

         500,000

Exchange differences on retranslation of foreign operations

               XXX

               XXX

Group cash flow hedges

 

 

–     effective portion of changes in fair value to cash flow hedges

  9            XXX

               XXX

–     fair value of cash flow hedges transferred to income statement

10            XXX

               XXX

Actuarial loss in respect of the defined pension scheme

11          (XXX)

             (XXX)

Gain/(loss) on revaluation of intangible assets

12            XXX

             (XXX)

Gain/(loss) on revaluation of property, plant and equipment

13            XXX

             (XXX)

Gain/(loss) on revaluation of subsidiaries, associates, etc.

14            XXX

             (XXX)

Deferred tax on components of other comprehensive income

15            XXX

               XXX

 

 

 

Total other comprehensive income for the year net of tax

         200,000

      (100,000)

 

 

 

Total comprehensive income for the year

      1,200,000

         400,000

 

Total comprehensive income for the financial year attributable to:

Non-controlling interests

 

            XXXX

 

              XXXX

Owners of the company

               XXX

               XXX

 

     1,200,000

         400,000


Example 3(a): Two statement approach for an individual entity (i.e. not group accounts)

Profit and Loss Account

 

 

 

For the Year Ended 31 December 2015

 

 

 

 

           Notes

            2015

              2014

 

 

               CU

                CU

Turnover

                  1

         XXXXX

           XXXXX

Cost of sales

 

         (XXXX)

          (XXXX) 

Gross profit

 

            XXXX

              XXXX

Selling and distribution costs

 

            (XXX)

             (XXX)

Administrative expenses

 

            (XXX)

             (XXX)

Other operating income

 

              XXX

               XXX 

Operating profit

                  3

              XXX

               XXX

Income from shares in group undertakings

                  4

               XXX

               XXX

Income from shares in other financial assets

                  4

              XXX

               XXX

Income from shares in participating interests

                  5

              XXX

                XXX

Profit on ordinary activities before interest and taxation

 

           XXXX

              XXXX

Interest receivable and similar income

                  6

              XXX

               XXX

Interest payable and similar income

7

            (XXX)

            (XXX) 

Profit on ordinary activities before taxation

 

            XXXX

              XXXX

Tax on profit on ordinary activities

8

          (XXX) 

          (XXX)

Profit for the financial year

 

    1,000,000

         500,000

 

Profit for the financial year attributable to:

 

 

Owners of the parent company

      1,000,000

         500,000

 

      1,000,000

         500,000

SEPARATE PAGE IN THE FINANCIAL STATEMENTS INCLUDE:

Consolidated Statement of Comprehensive Income

Profit for the financial year

      1,000,000

         500,000

Cash flow hedges

 

 

–     effective portion of changes in fair value to cash flow hedges

  9            XXX

               XXX

–     fair value of cash flow hedges transferred to income statement

10            XXX

               XXX

Actuarial loss in respect of the defined pension scheme

11          (XXX)

             (XXX)

Gain/(loss) on revaluation of intangible assets

12            XXX

             (XXX)

Gain/(loss) on revaluation of property, plant and equipment

13            XXX

             (XXX)

Gain/(loss) on revaluation of subsidiaries, associates, etc.

14            XXX

             (XXX)

Deferred tax on components of other comprehensive income

15            XXX

               XXX

 

 

 

Total other comprehensive income for the year net of tax

         200,000

      (100,000)

 

 

 

Total comprehensive income for the year

      1,200,000

         400,000

 

Total comprehensive income for the financial year attributable to:

 

 

Owners of the parent company

               XXX

               XXX

 

      1,200,000

         400,000


 

Alternative profit and loss format

Extract from FRS102: Section 5.7B-5.7C

5.5B An entity choosing to apply paragraph 1A(2) of Schedule 1 to the Regulations and adapt one of the profit and loss account formats shall, as a minimum, include in its statement of comprehensive income line items that present the following amounts for the period:

(a) revenue;

(b) finance costs;

(c) share of the profit or loss of investments in associates (see Section 14 Investments in Associates) and jointly controlled entities (see Section 15 Investments in Joint Ventures) accounted for using the equity method;

(d) profit or loss before taxation;

(e) tax expense excluding tax allocated to items (h) and (i) below or to equity (see paragraph 29.27);

(f) as set out in paragraph 5.7E (including a column identified as discontinued operations) a single amount comprising the total of:

(i) the post-tax profit or loss of a discontinued operation, and

(ii) the post-tax gain or loss recognised on the remeasurement of the impairment or on the disposal of the assets or disposal group(s) constituting discontinued operations.

(g) profit or loss;

(h) each item of other comprehensive income classified by nature (excluding amounts in (i));

(i) share of other comprehensive income of associates and jointly controlled entities accounted for by the equity method; and

(j) total comprehensive income.

5.5C An entity may include additional line items in the income statement and amend the descriptions used in paragraph 5.5B, and the ordering of items, when this is necessary to explain the elements of financial performance, providing the information given is at least equivalent to that required by the profit and loss account format had it not been adapted.

OmniPro comment

The profit and loss should follow the layout of the Companies Act or can be laid out in the format in Section 5.5B and Section 5.5C. Section 5.5B and 5.5C relates to a different choice as to what format the balance sheet can be presented in. This is not applicable for companies registered in the Republic of Ireland at this time as the EU directive 2013/34 has not been enacted. UK companies can currently use this layout if they wish, providing they have early adopted the September 2015 amendments to FRS102. This is not specific to small companies.

See example of this layout below.


Example 4: Consolidated Statement of Comprehensive Income – Alternative Approach

 

 

 

 

For the Year Ended 31 December 2015

 

 

 

 

            Notes

             2015

             2014

 

 

                CU

                CU

Revenue

                   1

            XXXXX

            XXXXX

Cost of sales

 

           (XXXX)

           (XXXX)

 

 

 

 

Gross profit

 

             XXXX

             XXXX

Selling and distribution costs

 

             (XXX)

             (XXX)

Administrative expenses

 

             (XXX)

             (XXX)

Other operating income

 

               XXX

               XXX

 

 

 

 

Group operating profit

                   3

               XXX

               XXX

Share of profit in associates

                   4

               XXX

               XXX

Share of profit in joint venture

                   5

                XXX

               XXX

 

 

 

 

Profit before interest and taxation

 

             XXXX

             XXXX

Finance income

                   6

               XXX

               XXX

Finance costs

                   7

             (XXX)

             (XXX)

 

 

 

 

Profit on before taxation

 

             XXXX

             XXXX

Income tax on profit

                   8

             (XXX)

             (XXX)

 

 

 

 

Profit for the financial year

 

        1,000,00

         500,000

 

cash flow hedges

 

 

–     effective portion of changes in fair value to cash flow hedges

  9            XXX

               XXX

–     fair value of cash flow hedges transferred to income statement

10            XXX

               XXX

Actuarial loss in respect of the defined pension scheme

11          (XXX)

             (XXX)

Share of other comprehensive income of associates

12            XXX

             (XXX)

Share of other comprehensive income of joint controlled entities

12            XXX

             (XXX)

Gain/(loss) on revaluation of intangible assets

12            XXX

             (XXX)

Gain/(loss) on revaluation of property, plant and equipment

13            XXX

             (XXX)

Gain/(loss) on revaluation of subsidiaries, associates, etc.

14            XXX

             (XXX)

Deferred tax on components of other comprehensive income

15            XXX

               XXX

 

 

 

Total other comprehensive income for the year net of tax

         200,000

      (100,000)

 

 

 

Total comprehensive income for the year

      1,200,000

         400,000

 

Total comprehensive income for the financial year attributable to:

 

 

 

 

 

Owners of the parent company

      1,200,000

         400,000

 

      1,200,000

         400,000

Profit for the financial year attributable to:

 

 

 

 

 

Owners of the parent company

      1,000,000

         400,000


 

 

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