Get ready for IFRS 18: The new financial statements presentation and disclosure standard

In April 2024, the International Accounting Standards Board (IASB) issued the new accounting standard, IFRS 18 'Presentation and Disclosure in Financial Statements.' This will replace the existing IAS 1 'Presentation of Financial Statements' standard that has been in use for many years. 

On the surface this new Standard may appear straightforward, setting out a new presentation requirement for the statement of profit or loss, and providing new disclosures relating to management-defined performance measures. However, the detail of these new requirements can lead to potential challenges that reporting entities will need to deal with to appropriately apply the new Standard.

While entities are dealing with a wide range of new reporting requirements, from international tax reform to sustainability reporting, changes to the presentation and disclosures in financial statements may not currently be at the top of their priorities. However, given the potentially pervasive changes brought about by IFRS 18, getting ready for IFRS 18 implementation should be prioritised. 

This publication sets out a high-level overview of IFRS 18's new requirements, along with practical insights into the application challenges. For some entities in particular, this will highlight the need to begin their transition journey early, to ensure that they are fully prepared for mandatory application for annual reporting periods beginning on or after 1 January 2027, including retrospective  restatement of comparatives.