IFRS Core Tools - EY

1 ifrs core ToolsGood Investment Fund Limited (Equity)Illustrative financial statements for the year ended 31 December 2015 International GAAP 1 Good Investment Fund Limited (Equity) Contents Abbreviations and key .. 2 Introduction .. 3 Independent auditor s report to the shareholders of Good Investment Fund Limited (Equity) .. 8 Statement of comprehensive income .. 9 Statement of financial position .. 10 Statement of changes in equity .. 11 Statement of cash flows .. 12 Notes to the financial statements .. 15 Appendix 1 Statement of cash flows (example of direct method) .. 64 Appendix 2 Examples of other market risk disclosures .. 65 Appendix 3 Fund with treasurey shares .. 66 Appendix 4 Fund which reclassifies puttable shares .. 67 Appendix 5 Fund with non-puttable shares.

2 71 Appendix 6 Fund with more than one segment .. 72 Appendix 7 Comparison between different variations of funds .. 76 Appendix 8 Information in other illustrative financial statements available .. 77 Good Investment Fund Limited (Equity) 2 Abbreviations and key The following styles of abbreviation are used in these International GAAP Illustrative Financial Statements: IAS International Accounting Standard No. 33, paragraph 41 IAS International Accounting Standard No. 1, Basis for Conclusions, paragraph 13 ifrs International Financial Reporting Standard No. 2, paragraph 44 SIC Standing Interpretations Committee Interpretation No. 29, paragraph 6 IFRIC ifrs Interpretations Committee (formerly IFRIC) Interpretation No. 4, paragraph 6 IAS International Accounting Standard No.

3 39 Guidance on Implementing IAS 39 Section G: Other, paragraph IAS International Accounting Standard No. 39 Appendix A Application Guidance, paragraph AG71 ISA International Standard on Auditing No. 700, paragraph 25 Commentary The commentary explains how the requirements of ifrs have been implemented in arriving at the illustrative disclosure GAAP Generally Accepted Accounting Principles/Practice IASB International Accounting Standards Board Interpretations Committee ifrs Interpretations Committee (formerly International Financial Reporting Interpretations Committee (IFRIC)) SIC Standing Interpretations Committee 3 Good Investment Fund Limited (Equity) Introduction This publication contains an illustrative set of financial statements of Good Investment Fund Limited (Equity) (the Fund) that is prepared in accordance with International Financial Reporting Standards ( ifrs ).

4 The Fund is a fictitious open-ended investment fund, incorporated and listed in a fictitious country within Europe. The Fund s functional and presentation currency is the Euro ( ). These illustrative financial statements are of a fund whose puttable shares are classified as equity instruments under IAS 32 Financial Instruments: Presentation. A separate publication entitled, Good Investment Fund Limited (Liability), whose puttable shares are classified as liability under IAS 32 is also available at Objective This set of illustrative financial statements is one of many prepared by EY to assist you in preparing your own financial statements. The illustrative financial statements are intended to reflect transactions, events and circumstances that we consider to be most common for a broad range of companies.

5 Certain disclosures are included in these financial statements merely for illustrative purposes, even though they may be regarded as items or transactions that are not material for Good Investment Fund Limited (Equity). How to use these illustrative financial statements to prepare entity-specific disclosures Users of this publication are encouraged to prepare entity-specific disclosures, for which these illustrative financial statements may serve as a useful reference. Transactions and arrangements other than those addressed by the Fund may require additional disclosures. It should be noted that the illustrative financial statements of the Fund are not designed to satisfy any stock market or country-specific regulatory requirements, nor is this publication intended to reflect disclosure requirements that apply mainly to regulated or specialised industries.

6 Notations shown on the right-hand margin of each page are references to ifrs paragraphs that describe the specific disclosure requirements. Commentaries are provided to explain the basis for the disclosure or to address alternative disclosures not included in the illustrative financial statements. For a more comprehensive list of disclosure requirements please refer to EY s Online International GAAP Disclosure Checklist. If questions arise as to the ifrs requirements, it is essential to refer to the relevant source material and, where necessary, to seek appropriate professional advice. Improving disclosure effectiveness The terms disclosure overload and cutting the clutter describe an acute problem in financial reporting that has become a priority issue for the International Accounting Standards Board (IASB or the Board), local standard setters, and regulatory bodies.

7 The growth and complexity of financial disclosure is also drawing significant attention from financial statement preparers, and most importantly, the users of financial statements. Even though there is no formal definition of disclosure overload , from the different discussions and debates among stakeholders, three common themes have appeared, namely financial statements format or structure, tailoring and materiality. In Good Investment Fund (Equity) illustrative financial statements for the year ended 31 December 2015, the ordering of the notes follows, to a great extent, the structure suggested in paragraph 114 of IAS 1 Presentation of Financial Statements. An alternative structure that some may find more effective in permitting the users to identify the relevant information more easily, involves reorganising the notes according to their nature and perceived importance.

8 An illustrative ordering of the alternative structure that is based on seven different notes sections is summarised in the table below: Sections For example, comprising: Corporate information Corporate information Basis of preparation and other significant accounting policies Basis of preparation Other significant accounting policies not covered in other sections (below) Changes in accounting policies and disclosures Significant accounting judgements, estimates and assumptions Fair value measurement and related fair value disclosures Impact of standards issued but not yet effective Business, operations, and management Segment information Information on investment in subsidiaries and investment in associates Good Investment Fund Limited (Equity) 4 Sections For example, comprising.

9 Capital management Financial risk management objectives and policies Distributions made and proposed Significant transactions and events Hedging activities and derivatives Related party transactions Events after reporting period Detailed information on statement of comprehensive income items Finance income and costs Foreign exchange differences Earnings per share Detailed information on statement of financial position items Investment properties Financial assets and liabilities Trade and other receivables and payables Cash and short-term deposits Issued capital and reserves Commitments and contingencies Commitments and contingencies By structuring the notes according to their nature and perceived importance, a user may more easily be able to extract the more relevant information sought.

10 In addition, the significant accounting policies could alternatively be placed within the same note as the related qualitative and quantitative disclosures to provide a more holistic picture to users of the financial statements. The alternative structure summarised above has been applied in Good Group (International) Limited 2015 An Alternative Format. While this is a different entity from Good Investment Fund Limited, it may assist reporters if they wish to use this alternative format. Entities may find that other structures are better in enhancing disclosure effectiveness, and the approach summarised above and illustrated in Good Group (International) Limited 2015 An Alternative Format is only meant to illustrate that ifrs allows for alternative notes structures. Entities should carefully assess their entity-specific circumstances and the preferences of the primary users before deciding on notes structure.