Illustrative IFRS consolidated financial statements - PwC IFRS consolidated financial statements ... These illustrative financial statements are not a substitute for reading the ... 40 Transactions with non

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<ul><li><p>Illustra</p><p>tive IFR</p><p>S con</p><p>solid</p><p>ated</p><p> fin</p><p>an</p><p>cial sta</p><p>temen</p><p>ts for 2011 year ends</p><p>Illustrative IFRS consolidated financial statements for 2011 year ends</p><p>Stay informed. Visit www.pwcinform.com</p></li><li><p>Illustrative IFRS corporate consolidatedfinancial statements for 2011 year ends</p><p>Global Accounting Consulting ServicesPricewaterhouseCoopers LLP</p></li><li><p>Bloomsbury Professional, an imprint of Bloomsbury Publishing Plc, Maxwelton House, 4143 Boltro Road,Haywards Heath, West Sussex, RH16 1BJ</p><p>This book has been prepared for general guidance on matters of interest only, and does not constitute professional advice. Youshould not act upon the information contained in this book without obtaining specific professional advice. Accordingly, to the extentpermitted by law, PricewaterhouseCoopers LLP (and its members, employees and agents) and publisher accept no liability, anddisclaim all responsibility, for the consequences of you or anyone else acting, or refraining from acting, in reliance on theinformation contained in this document or for any decision based on it, or for any consequential, special or similar damages even ifadvised of the possibility of such damages.</p><p>All rights reserved. No part of this publication may be reproduced in any material form (including photocopying or storing it in anymedium by electronic means and whether or not transiently or incidentally to some other use of this publication) without the writtenpermission of PricewaterhouseCoopers LLP except in accordance with the provisions of the Copyright, Designs and Patents Act1988 or under the terms of a licence issued by the Copyright Licensing Agency Ltd, Saffron House, 610 Kirby Street, LondonEC1N 8TS. Applications for the copyright owners written permission to reproduce any part of this publication should be addressedto the publisher.Warning: The doing of an unauthorised act in relation to a copyright work may result in both a civil claim for damages and criminalprosecution.</p><p>ISBN 9781847669094</p><p>British Library Cataloguing-in-Publication Data.A catalogue record for this book is available from the British Library.</p><p># 2011 PricewaterhouseCoopers</p><p>Printed in Great Britain.</p></li><li><p>IFRS GAAP plc year ended 31 December 2011</p><p>PwC Illustrative IFRS corporate consolidated financial statements for 2011 year ends iii</p></li><li><p>iv PwC Illustrative IFRS corporate consolidated financial statements for 2011 year ends</p></li><li><p>Introduction</p><p>This publication provides an illustrative set of consolidated financial statements, prepared in accordance withInternational Financial Reporting Standards (IFRS), for a fictional manufacturing, wholesale and retail group (IFRSGAAP plc).</p><p>IFRS GAAP plc is an existing preparer of IFRS consolidated financial statements; IFRS 1, First-time adoption ofInternational Financial Reporting Standards, is not applicable.</p><p>This publication is based on the requirements of IFRS standards and interpretations for financial years beginning onor after 1 January 2011.</p><p>PwC commentary has been provided, in grey boxes, to explain the detail behind the presentation of a number ofchallenging areas. These commentary boxes relate to the presentation in: the income statement, statement ofcomprehensive income, balance sheet, statement of changes in equity, statement of cash flows, statement ofsignificant accounting policies and financial risk management.</p><p>Areas in which we have made significant changes to presentation since 2010 have been highlighted in pink.</p><p>We have attempted to create a realistic set of financial statements for a corporate entity. However, by necessity weillustrate disclosures that for many entities may be immaterial. Determining the level of disclosure is a matter ofjudgement, and naturally disclosure of immaterial items is not required. Certain types of transaction have beenexcluded, as they are not relevant to the groups operations. The example disclosures, if material, for some of theseadditional items have been included in appendix III. The forthcoming IFRS requirements are outlined in a table inappendix IV.</p><p>The example disclosures should not be considered the only acceptable form of presentation. The form and contentof each reporting entitys financial statements are the responsibility of the entitys management. Alternativepresentations to those proposed in this publication may be equally acceptable if they comply with the specificdisclosure requirements prescribed in IFRS.</p><p>These illustrative financial statements are not a substitute for reading the standards and interpretations themselves orfor professional judgement as to fairness of presentation. They do not cover all possible disclosures that IFRSrequires. Further specific information may be required in order to ensure fair presentation under IFRS. Werecommend that readers refer to our publication IFRS disclosure checklist 2011.</p><p>Abbreviations</p><p>IFRS1p37 = International Financial Reporting Standard [number], paragraph number.</p><p>7p22 = International Accounting Standards [number], paragraph number.</p><p>SIC 15p5 = Standing Interpretations Committee [number], paragraph number.</p><p>DV = Disclosure Voluntary. Disclosure is encouraged but not required and therefore representsbest practice.</p><p>PwC Illustrative IFRS corporate consolidated financial statements for 2011 year ends v</p></li><li><p>vi PwC Illustrative IFRS corporate consolidated financial statements for 2011 year ends</p></li><li><p>Contents</p><p>PageFinancial statements ..................................................................................................................................................... 1Notes to the consolidated financial statements:1 General information ............................................................................................................................................... 152 Summary of significant accounting policies: ....................................................................................................... 15</p><p>2.1 Basis of preparation ................................................................................................................................ 152.2 Consolidation ........................................................................................................................................... 162.3 Segment reporting ................................................................................................................................... 172.4 Foreign currency translation .................................................................................................................... 172.5 Property, plant and equipment ................................................................................................................ 182.6 Intangible assets ..................................................................................................................................... 182.7 Impairment of non-financial assets ......................................................................................................... 192.8 Non-current assets (or disposal groups) held for sale ............................................................................ 192.9 Financial assets ...................................................................................................................................... 192.10 Offsetting financial instruments ............................................................................................................... 202.11 Impairment of financial assets ................................................................................................................. 202.12 Derivative financial instruments and hedging activities ........................................................................... 212.13 Inventories ............................................................................................................................................... 222.14 Trade receivables .................................................................................................................................... 222.15 Cash and cash equivalents ..................................................................................................................... 222.16 Share capital ........................................................................................................................................... 222.17 Trade payables ....................................................................................................................................... 222.18 Borrowings .............................................................................................................................................. 222.19 Borrowing costs ....................................................................................................................................... 232.20 Compound financial instruments ............................................................................................................. 232.21 Current and deferred income tax ............................................................................................................ 232.22 Employee benefits ................................................................................................................................... 232.23 Share-based payments ........................................................................................................................... 232.24 Provisions ................................................................................................................................................ 242.25 Revenue recognition ............................................................................................................................... 252.26 Interest income ........................................................................................................................................ 262.27 Dividend income ...................................................................................................................................... 262.28 Leases ..................................................................................................................................................... 262.29 Dividend distribution ................................................................................................................................ 262.30 Exceptional items .................................................................................................................................... 26</p><p>3 Financial risk management ................................................................................................................................... 284 Critical accounting estimates and judgements .................................................................................................... 365 Segment information ............................................................................................................................................. 386 Exceptional items ................................................................................................................................................... 417 Other income ......................................................................................................................................................... 418 Other (losses)/gains net ..................................................................................................................................... 419 Expenses by nature ............................................................................................................................................... 4110 Employee benefit expense .................................................................................................................................... 4211 Finance income and costs .................................................................................................................................... 4212 Investments in associates ..................................................................................................................................... 4213 Income tax expense .............................................................................................................................................. 4314 Earnings per share ................................................................................................................................................ 4415 Net foreign exchange gains/(losses) .................................................................................................................... 4516 Property, plant and equipment ............................................................................................................................. 4517 Intangible assets .................................................................................................................................................... 4718a Financial instruments by category ........................................................................................................................ 4918b Credit quality of financial assets ........................................................................................................................... 5019 Available-for-sale financial assets ......................................................................................................................... 5120 Derivative financial instruments ............................................................................................................................. 5221 Trade and other receivables ................................................................................................................................. 5322 Inventories .............................................................................................................................................................. 5423 Financial assets at fair value through profit or loss ............................................................................................. 5424 Cash and cash equivalents ................................................................................................................................... 5525 Non-current assets held for sale and discontinued operations .......................................................................... 55</p><p>PwC Illustrative IFRS corporate consolidated financial statements for 2011 year ends vii</p></li><li><p>26 Share capital and premium ................................................................................................................................... 5627 Share-based payments ......................................................................................................................................... 5628 Retained earnings ......................................................................................................................</p></li></ul>

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