Financial statements

SUBJECT	IFRS	US GAAP
Financial statements
Balance sheet	Does not prescribe a particular format; an entity uses a liquidity presentation of assets and liabilities, instead of a current/non-current presentation, only when a liquidity presentation provides more relevant and reliable information. Certain items must be presented on the face of the balance sheet.	Entities may present either a classified or non-classified balance sheet. Items presented on the face of the balance sheet are generally presented in decreasing order of liquidity. Public companies must follow SEC guidelines regarding minimum disclosure requirements.
Income statement	Does not prescribe a standard format, although expenditure must be presented in one of two formats (function or nature). Certain items must be presented on the face of the income statement.	Present as either a single-step or multiple-step format. Expenditure must be presented by function.
Exceptional items	Does not use the term, but requires separate disclosure of items that are of such size, incidence or nature that require separate disclosure to explain the performance of the entity.	Similar to IFRS, but individually significant items should be presented on the face of the income statement.
Extraordinary items	Prohibited.	Defined as being both infrequent and unusual, and are rare. Negative goodwill is presented as an extraordinary item.
Statement of recognised gains and losses/other comprehensive income	Present the statement of recognised gains and losses as either in notes or highlight separately in primary statement of changes in shareholder equity.	Disclose total comprehensive income and accumulated other comprehensive income, either as a separate primary statement or combined with income statement, or with statement of changes in stockholders' equity.
Statement of changes in shareholders' equity	Statement showing capital transactions with owners, the movement in accumulated profit and a reconciliation of all other components of equity. The statement must be presented as a primary statement.	Similar to IFRS. SEC rules allow such information to be included in the notes.
Cash flow statements – format and method	Standard headings, but limited flexibility of contents. Use direct or indirect method.	Similar headings to IFRS, but more specific guidance given for items included in each category. Use direct or indirect method.
Cash flow statements– definition of cash and cash equivalents	Cash includes overdrafts and cash equivalents with short-term maturities (less than 3 months).	Cash excludes overdrafts but includes cash equivalents with short-term maturities.
Cash flow statements– exemptions	No exemptions.	Limited exemptions for certain investment entities.
Changes in accounting policies	Restate comparatives and prior-year opening retained earnings.	Include effect in current-year income statement. Disclose pro-forma comparatives. Include retrospective adjustments for specific items.
Correction of errors	Restate comparatives.	Similar to IFRS.
Changes in accounting estimates	Reported in income statement in the current period.	Similar to IFRS.