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Notes to the Financial Statements

Scope of this section

  1. 1 This section sets out the principles underlying information that is to be presented in the notes to the financial statements and how to present it. Notes contain information in addition to that presented in the statement of financial position, the statement of comprehensive income (if presented), the income statement (if presented), the combined statement of income and retained earnings (if presented), the statement of changes in equity (if presented) and the statement of cash flows. Notes provide narrative descriptions or disaggregations of items presented in those statements and information about items that do not qualify for recognition in those statements. In addition to the requirements of this section, nearly every other section of this Standard requires disclosures that are normally presented in the notes.

Structure of the notes

  1. 2 The notes shall:
    1. present information about the basis of preparation of the financial statements and the specific accounting policies used, in accordance with paragraphs 8.5–8.7;
    2. disclose the information required by this Standard that is not presented elsewhere in the financial statements; and
    3. provide information that is not presented elsewhere in the financial statements but is relevant to an understanding of any of them.
  1. 3 An entity shall, as far as practicable, present the notes in a systematic manner. An entity shall cross-reference each item in the financial statements to any related information in the notes.
  1. 4 An entity normally presents the notes in the following order:
    1. a statement that the financial statements have been prepared in compliance with the IFRS for SMEs (see paragraph 3.3);
    2. a summary of significant accounting policies applied (see paragraph 8.5);
    3. supporting information for items presented in the financial statements, in the sequence in which each statement and each line item is presented; and
    4. any other disclosures.

Disclosure of accounting policies

  1. 5 An entity shall disclose the following in the summary of significant accounting policies:
    1. the measurement basis (or bases) used in preparing the financial statements; and
    2. the other accounting policies used that are relevant to an understanding of the financial statements.

Information about judgements

  1. 6 An entity shall disclose, in the summary of significant accounting policies or other notes, the judgements, apart from those involving estimations (see paragraph 8.7), that management has made in the process of applying the entity’s accounting policies and that have the most significant effect on the amounts recognised in the financial statements.

Information about key sources of estimation uncertainty

  1. 7 An entity shall disclose in the notes information about the key assumptions concerning the future, and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a materialadjustment to the carrying amounts of assets and liabilities within the next financial year. In respect of those assets and liabilities, the notes shall include details of:
    1. their nature; and
    2. their carrying amount as at the end of the reporting period.