Illustrative condensed consolidated interim financial ... condensed consolidated interim financial information ... Volume 1 • IFRS Manual of ... Illustrative condensed consolidated interim financial information

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<ul><li><p>International/ Hong Kong Financial Reporting Standards</p><p>www.pwchk.com</p><p>Illustrative condensed consolidated interim financial informationFor the six months ended 30 June 2016</p></li><li><p>2016 IFRS Manual of accounting Global guide to IFRS providing comprehensive practical guidance on how to prepare financial statements in accordance with IFRS. Includes hundreds of worked examples and guidance on financial instruments. The Manual is a three-volume set comprising: Manual of accounting IFRS 2015 </p><p>Vol. 1 and Vol. 2 Manual of accounting IFRS 2015 </p><p>supplement Language: English </p><p>In depth - New IFRSs for 2016 This publication outlines the new IFRS standards and amendments plus those standards and amendments that are effective from 1 January 2016. Language: English </p><p>Illustrative IFRS/HKFRS consolidated financial statements - For the year ended 31 Dec 2015 The 2015 version of the illustrative IFRS/HKFRS consolidated financial statements is for a fictional manufacturing, wholesale and retail group. The illustrative example is prepared in accordance with the requirements as set out in: The new Hong Kong Companies </p><p>Ordinance (Cap. 622); The Listing Rules issued by the </p><p>Stock Exchange of Hong Kong Limited; </p><p> IFRSs issued by the International Accounting Standards Board; and </p><p> HKFRSs issued by the Hong Kong Institute of Certified Public Accountants. </p><p> Language: English </p><p>Practical guides to IFRS Practical guides to IFRS provide updates on the guidance in recently released discussion papers, exposure drafts and final standards from the IASB. Language: English and Simplified Chinese </p><p>IFRS/HKFRS News Monthly newsletter highlighting the latest update in the International/Hong Kong Financial Reporting Standards. Language: English </p><p>IFRS/HKFRS News (Chinese) Monthly newsletter highlighting the latest update in the International/Hong Kong Financial Reporting Standards. Language: Simplified Chinese </p><p>Please visit www.pwccn.com/home/eng/latestacctupdates.html for more publications. </p><p>PwCs Accounting Technical Publications </p></li><li><p> IFRS Manual of Accounting (English with Chinese translation) IFRS Manual of Accounting is a comprehensive practical guide to IFRS and provides straightforward explanations on how to prepare financial statements in accordance with IFRS, with hundreds of practical examples. IFRS Manual of Accounting with Chinese translation has been released in different volumes. The following volumes have been published by China Financial &amp; Economic Publishing House. Depending on the topic, each release may be a chapter or a combination of a number of chapters from the manual. </p><p>MoA Volume 14: Consolidated financial statements and joint arrangements This volume covers Chapter 24 Consolidated financial statements and Chapter 28 Joint arrangements of the English version and their translation. </p><p>MoA Volume 15: Employee benefits This volume covers Chapter 11 Employee benefits of the English version and its translation. </p><p>MoA Volume 16: Insurance contracts and Fair value This volume covers Chapter 8 Insurance contracts and Chapter 34 Fair value of the English version and their translation. </p><p> The below volumes (English with Chinese translation) are also available: </p><p> IFRS Manual of Accounting - Volume 1: Revenue and construction contracts IFRS Manual of Accounting - Volume 2: Accounting principles and applicability of IFRS; Presentation of </p><p>financial statements; Accounting policies, accounting estimates and errors IFRS Manual of Accounting - Volume 3: Taxation IFRS Manual of Accounting - Volume 4: Share-based payment IFRS Manual of Accounting - Volume 5: Business combinations IFRS Manual of Accounting - Volume 6: Intangible assets and inventories IFRS Manual of Accounting - Volume 7: Property, plant and equipment, investment property and lease </p><p>accounting IFRS Manual of Accounting - Volume 8: Impairment of assets IFRS Manual of Accounting - Volume 9: Consolidated and separate financial statements and equity </p><p>accounting IFRS Manual of Accounting - Volume 10: Disposals of subsidiaries, business and non-current assets IFRS Manual of Accounting - Volume 11: Foreign currencies IFRS Manual of Accounting - Volume 12: Earnings per share IFRS Manual of Accounting - Volume 13: Service concession arrangements IFRS Manual of Accounting - Financial Instruments (English with Chinese translation) Volume 1 IFRS Manual of Accounting - Financial Instruments (English with Chinese translation) Volume 2 IFRS Manual of Accounting - Financial Instruments (English with Chinese translation) Volume 3 </p><p> Please visit www.pwccn.com/home/eng/ifrs_accounting_manual.html for details. </p><p>PwCs Accounting Technical Publications </p><p>http://www.pwccn.com/home/eng/ifrs_accounting_manual.html</p></li><li><p>1 </p><p>Introduction to IAS/HKAS 34, 'Interim financial reporting' </p><p>Objective and scope </p><p>Although there is no requirement under IFRS/HKFRS for entities to publish interim financial reports, a number of territories around the world either require or recommend their publication, often stipulating that they should be prepared in accordance with IFRS/HKFRS. IAS/HKAS 34, 'Interim financial reporting', applies where an entity publishes an interim financial report in accordance with IFRS/HKFRS. It encourages publicly traded entities to prepare interim reports at least as of the end of the first half of their financial year [IAS/HKAS 34 para 1(a)]. </p><p>The objective of IAS/HKAS 34 is to set out the minimum content that an interim financial report should contain and the principles that should be used in recognising and measuring the transactions and balances included in that report. </p><p>IAS/HKAS 34 recommends that interim financial reports are published within 60 days of the period end, although local legislative requirements may mandate a different timescale1 [IAS/HKAS 34 para 1(b)]. </p><p>Content </p><p>Entities may either prepare full IFRS/HKFRS financial statements (as published in their annual report), or condensed financial statements under IAS/HKAS 34. Condensed reporting is the more common approach. </p><p>IAS/HKAS 34 requires the interim financial report to contain, as a minimum: </p><p> A statement of financial position (balance sheet) as at the end of the current interim period and as at the end of the immediately preceding financial year. </p><p> A statement or statements of profit or loss and other comprehensive income for the current interim period and cumulatively for the current financial year to date (for example, the second quarter and the half year to date), with comparative statements for the comparable interim periods of the immediately preceding financial year. </p><p> A statement of changes in equity for the year to date, with a comparative statement for the comparable year-to-date period </p><p>of the immediately preceding financial year. A statement of cash flows for the year to date, with a comparative statement for the comparable year-to-date period of the </p><p>immediately preceding financial year. Selected explanatory notes. Basic and diluted earnings per share for the interim period reported, presented in the statement that presents the </p><p>components of profit or loss for an interim period (only if the entity is required to present earnings per share in accordance with IAS/HKAS 33). </p><p>[IAS/HKAS 34 paras 8, 11] </p><p>The condensed primary statements should contain, as a minimum, the main headings and sub-totals that were included in the entity's most recent full financial statements. Additional line items or notes should be included if their omission would make the condensed interim financial report misleading [IAS/HKAS 34 para 10]. PwC observation: IAS/HKAS 34 does not require the presentation in the condensed primary statements of all the line items that are required by IAS/HKAS 1, Presentation of financial statements, to be included in the primary statements in the annual financial statements; however, it is common, and considered best practice, to include them. In some countries, the extent to which line items may be aggregated in condensed interim financial statements may also be governed by local regulators or market requirements. </p><p> IAS/HKAS 34 requires additional line items or notes to be included if their omission would make the condensed interim financial report misleading [IAS/HKAS 34 para 10]. An entity may incur costs on an annual basis that are not significant enough in the context of the annual financial statements to require separate disclosure. However, such costs might be incurred unevenly during the year and require separate presentation in the condensed statement of profit or loss, thus leading to a difference in presentation between the interim financial report and the annual comparative financial statements. </p><p> 1 According to MB Listing Rule 13.49(6) and 13.48(1), a MB issuer must publish its interim results announcement not later than two months after the end of that period </p><p>of six months and must send out either (i) its interim report, or (ii) its summary interim report not later than three months after the end of that period of six months. </p><p>According to GEM Listing Rule 18.53 and 18.78, a GEM issuer must publish its interim results announcement and send out either (i) its interim report, or (ii) its summary interim report not later than 45 days after the end of such period. </p></li><li><p>2 </p><p>IAS/HKAS 34 requires comparative information to be given for all primary statements. A comparative statement of financial position should be given for the last full financial year. IAS/HKAS 34 does not require statement of financial position comparatives for the prior interim period. Statement of profit or loss and other comprehensive income comparatives should be given for the comparative interim period, but comparatives for the last full financial year are not required. IAS/HKAS 34 requires in addition a cumulative current year-to-date statement of profit or loss and other comprehensive income with comparatives. This will be relevant to those choosing to report under IAS/HKAS 34 at quarterly dates. For example, at the third quarter, results would be given for the three months to the end of the third quarter, and also for the nine months to the end of the third quarter. Equity movement and cash flow comparative information is required for the equivalent year-to-date period in the previous year [IAS/HKAS 34 para 20]. </p><p>Statements required for entities that report half-yearly at the end of the second quarter </p><p>Statement Current Comparative </p><p>Statement of financial position at 30 June 20X6 31 December 20X5 Statement of profit or loss and other comprehensive income (and, where applicable, separate statement of profit or loss): six months ended </p><p>30 June 20X6 30 June 20X5 </p><p>Statement of changes in equity: six months ended </p><p>30 June 20X6 30 June 20X5 </p><p>Statement of cash flows: six months ended </p><p>30 June 20X6 30 June 20X5 </p><p>Statements required for entities that report quarterly at the end of the third quarter </p><p>Statement Current Comparative </p><p>Statement of financial position at 30 September 20X6 31 December 20X5 </p><p>Statement of profit or loss and other comprehensive income (and, where applicable, separate statement of profit or loss) - nine months ended - three months ended </p><p>30 September 20X6 30 September 20X6 </p><p>30 September 20X5 30 September 20X5 </p><p>Statement of changes in equity - nine months ended </p><p> 30 September 20X6 </p><p> 30 September 20X5 </p><p>Statement of cash flows - nine months ended </p><p> 30 September 20X6 </p><p> 30 September 20X5 </p><p>If an interim financial report is presented for a different interim reporting period, the heading of the financial information should specify the interim reporting period covered (for example, 'For the quarter ended 30 September 2016' or 'For the third quarter ended 31 March 2017'); the heading for the figures should indicate whether they are presented for a quarter, a half-year or the financial year to date, as appropriate. </p><p>IAS/HKAS 34 has a year-to-date approach to interim reporting and does not replicate the requirements of IAS/HKAS 1 in terms of comparative information. As a consequence, it is not necessary to provide an additional balance sheet (statement of financial position) as at the beginning of the earliest comparative period presented where an entity has made a retrospective change in accounting policies and/or a retrospective reclassification. </p><p>The entity's annual financial statements give a comprehensive picture of the entity's state of affairs at the most recent year end and, therefore, the interim financial report should be read in conjunction with them. It is not necessary to give relatively insignificant updates to information already reported. The selected explanatory notes to the interim report should explain significant events and transactions that have occurred during the interim period [IAS/HKAS 34 para 15 and 15A]. </p></li><li><p>3 </p><p>The following is a list of events and transactions for which disclosures would be required if they are significant: the list is not exhaustive. </p><p>(a) the write-down of inventories to net realisable value and the reversal of such a write-down; (b) recognition of a loss from the impairment of financial assets, property, plant and equipment, intangible assets, or other </p><p>assets, and the reversal of such an impairment loss; (c) the reversal of any provisions for the costs of restructuring; (d) acquisitions and disposals of items of property, plant and equipment; (e) commitments for the purchase of property, plant and equipment; (f) litigation settlements; (g) corrections of prior period errors; (h) changes in the business or economic circumstances that affect the fair value of the entitys financial assets and financial </p><p>liabilities, whether those assets or liabilities are recognised at fair value or amortised cost; (i) any loan default or breach of a loan agreement that has not been remedied on or before the end of the reporting period; (j) related party transactions; (k) transfers between levels of the fair value hierarchy used in measuring the fair value of financial instruments; (l) changes in the classification of financial assets as a result of a change in the purpose or use of those assets; and (m) changes in contingent liabilities or contingent assets. </p><p> [IAS/HKAS 34 para 15B] </p><p>In addition to the above disclosures, the following should also be disclosed and normally be reported on a financial year-to-date basis [IAS/HKAS 34 para 16A]: </p><p> A statement that the accounting policies and methods of computation used in the interim financial statements are the same as those used in the most recent annual financial statements or, if this is not the case, a description of the nature and effect of the change. </p><p> Explanatory comments about seasonality or cyclicality of interim operations. The nature and amount of any items affecting assets, liabilities, equity, net income or cash flows that are unusual because of </p><p>their size, nature or incidence. The nature and amount of changes in est...</p></li></ul>

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