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Introduction

The preparation of financial statements, reports and data set which brings the informative details relevant with firm's growth, liquidity and ability to meet the debts. However, to prepare the suitable informative data base there will be requirement of implicating the authenticated framework to perform these activities. Similarly, in the present report there will be preparation of income statements which will present the revenue and expenses of Able Plc in the proposed period. Moreover, there will be determination of the facts and usefulness of the financial statements in relation with a regulatory framework of international accounting standards. The importance of such techniques in funneling the accounting professionals to prepare the financials as per the requirements.

Q1 International Financial Reporting standards and Income statement of Able Plc for the year 2017

Generally accepted accounting principles is been represented by International financial reporting standards and these are used by the organisations for the preparation of financial statements which has been published annually which is useful to stakeholders such as debtors, clients, shareholders, government and employees for the understanding of financial position and stability of the organizations. IFRS has been developed by International Accounting Standards Board, set of accounting rules adopted by more than 100 countries. The whole members of European Union should mandatory use IFRS. The increase of globalisation of financial markets and companies has increased the use of single set of financial reporting standards across all countries and it has made the comparison of financial statements easy across the borders. Due to this the cost of preparing financial statements has been reduced which has been prepared by group of companies which conducts business in the world. Generally these standards are developed by not for profit organisations and independent organizations (Cascino and Gassen, 2015).

The main objective of IFRS standard is to disclose the financial statement's preparation or in the same guidance has been provided for the procedure. The companies who have subsidiaries in many other countries have a vital and important role of IFRS standards. Statement of comprehensive income represents the financial performance of company. Sub parts of profit and loss statements such as revenue and expenses, enhancement of assets and inflows helps in raising economic benefit and if in case liabilities are decreased then there is increase in equity. Equity contributions like partners, owners and shareholders are not considered as revenue. And if there is outflow then there is decrease in economic benefit and because of increase in liabilities there is decrement in equity. Equity participants does not consist of distribution. There are major circumstances which are reflection of comprehensive income such as, remeasurement of assets and liabilities, fair value of financial asset might decrease or increase and can be modified as availability for sale and even revaluation of some assets such as plant, property and intangible asset may rise or fall.

Offsetting has been forbidden by IFRS standards. If some specific condition is mentioned then offsetting should be used. There is a basic need for fair representation for effect of all the conditions which are set according to IFRS framework and criteria should be recognised for income, assets, liabilities and expenses (Kieso, Weygandt and Warfield, 2010). Narrative and descriptive information is given by comparative information related to current year's financial statement and the alternative to know the financial position is the balance sheet statement of International accounting standard 1 and the items are been classified for financial statements. The income statement of Able plc. For the year ending 31 December 2017 is as follows:

Income statement of the year ending 31 December 2017

Particulars

Details

Amount (in £)

Net sales

205000

 

Return Inwards

-10000