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When an entity breaches a provision of a long term load agreement on or before the end of the
reporting period with the effect that the liability becomes payable on demand, it classifies the
liability as current, even if the lender agreed, after the reporting period and before the
authorization of the financial statement for issue, not to demand payment as a consequence of
breach. An entity classifies the liability as current because, at the end of the reporting period, it
does not have an unconditional right to defer its settlement for at least twelve months after that
date.

However, an entity classifies the liability as non-current if the lender agreed by the end of the
reporting period to provide a period of grace ending at least twelve months after the reporting
period, within which the entity can rectify the breach and during which the lender cannot demand
immediate repayment.

Statement of profit or loss and other comprehensive income

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Entities must provide information about the entity’s financial performance and management
stewardship through the statement of comprehensive income. Such objective is achieved by
providing information about the income and expenses presented in the statement of
comprehensive income

The statement of comprehensive income must present the total comprehensive income. Total
comprehensive income is the change in equity during a period resulting from transactions and
other events, other than those changes resulting from transactions which in their capacity as
owners. Total comprehensive income comprises of all components of ‘profit or loss’ and of
‘other comprehensive income’.

Profit or loss is the total of income less expenses, excluding the components of other
comprehensive income. Other comprehensive income comprises items of income and expense
(including reclassification adjustments) that are not recognized in profit or loss as required or
permitted by other PFRSs.

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an entity may either present a single statement of profit or loss and other comprehensive income
(one statement approach) or present the profit or loss section in a separate statement of profit or
loss and other comprehensive income in another separate statement (two-statement approach).

When using the one-statement approach, the profit or loss and other comprehensive income are
to be presented in two sections. The sections shall be presented together, with the profit or loss
section presented first followed directly by the other comprehensive income section.
When using the two –statement approach, it does not present the profit or loss section in the
statement presenting comprehensive income. The separate statement of profit or loss shall
immediately precede the statement presenting comprehensive income, which shall begin with
profit or loss.

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The following are components of other comprehensive income:

a. Changes in revaluation surplus;

b. Remeasurements of defined benefit plans;
c. Translation of gains and losses arising from translating the financial statements of a
foreign operation;
d. Unrealized gains and losses from investments in equity instruments designated at fair
value through other comprehensive income;
e. Unrealized gains and losses on financial assets measured at fair value through other
comprehensive income
f. The effective portion of gains and losses on hedging instruments in a cash flow hedge
and the gains and losses on hedging instruments that hedge investments in equity
instruments measured at fair value through other comprehensive income;
g. For particular liabilities designated as at fair value through profit or loss, the amount the
change in fair value that is attributable to changes in the liability’s credit risk;
h. Changes in the value of the time value of options when separating the intrinsic value and
time value of an option contract and designating as the hedging instrument only the
changes in the intrinsic value;
i. Changes in the value of the forward elements of forward contracts when separating
the forward element and spot element of a forward contract and designating as the
hedging instrument only the changes in the spot element and the changes in the value of
foreign currency basis spread of a financial instrument when excluding it from the
designation of that financial instrument as the hedging instrument;
j. Insurance finance income and expenses from contracts issues within the scope of PFRS
17 (Insurance Contracts) excluded from profit and loss; and
k. Finance income and expenses from reinsurance contracts held excluded from profit
or loss

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The statement of profit or loss and other comprehensive income (statement of comprehensive
income) shall present, in addition to the profit or loss and other comprehensive income sections:

a. Profit or loss:
b. Total other comprehensive income;
 c. Comprehensive income for the period, being the total of profit or loss and other
comprehensive income.

For the consolidated financial statements of entities with subsidiaries, an entity shall present the
following items, in addition to the profit or loss and other comprehensive income sections, such
as allocation of profit or loss and other comprehensive income for the period:

a. Profit or loss for the period attributable to:

i. Non-controlling interests; and
ii. Owners of the parent

b. Comprehensive income for the period attributable to:

i. Non-controlling interests; and
ii. Owners of the parent.

If an entity presents profit or loss in a separate statement it shall present (a) in that statement

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In addition to the items required by other PFRSs, the profit and loss section or the statement of
profit or loss shall include line items that will present the following amounts for the period:

a. Revenue, presenting separately:

i. Interest revenue calculated using the effective interest method; and
ii. Insurance revenue (see PFRS 17);

b. Gains and losses arising from the derecognition of financial assets measured at amortized
cost;
c. Insurance service expenses from contracts issued within the scope of PFRS 17;
d. Income or expenses from reinsurance contracts held (see PFRS 17);
e. Finance costs;
f. Impairment losses (including reversals of impairment losses or impairment gains)
determined in accordance with PFRS 9;
g. Insurance finance income or expenses from contracts issued within the scope of PFRS
17;
h. Finance income or expenses from reinsurance contracts held;
i. Share of the profit or loss of associates and joint ventures accounted for using the equity
method;
j. If a financial asset is reclassified out of the amortized cost measurement category so that
it is measured at fair value through profit or loss, any gain or loss arising from a
difference between the previous amortized cost of the financial asset and its fair value at
the reclassification date;
 k. If a financial asset is reclassified out of fair value through other comprehensive income
measurement category so that it is measured at fair value through profit or loss, any
cumulative gain or loss previously recognized in other comprehensive income that is
reclassified to profit or loss;
l. Tax expense; and
m. A single amount for the total of discounted operations (see PFRS 5)

An entity shall recognize all items of income and expense in a period in profit or loss unless a
PFRS requires or permits otherwise. Some PFRS specify circumstances when an entity
recognizes particular items outside profit or loss in the current period. PAS 8 specifies two such
circumstances: the correction of errors and the effect of changes in accounting policies.

An entity shall present additional line items (including disaggregation’s of the line items
enumerated above), headings and subtotals in the statement(s) presenting profit or loss and other
comprehensive income when such presentation is relevant to an understanding of the entity’s
financial performance.

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The other comprehensive income section shall present line items for the amounts for the period
of:

a. Items of other comprehensive income (excluding amounts in paragraph (b)), classified by

nature and grouped into those that, in accordance with other IFRSs:
i. Will not be reclassified subsequently to profit or loss; and
ii. Will be reclassified subsequently to profit or loss when specified conditions are
met.
b. The share of the other comprehensive income of associates and joint ventures accounted
for using the equity method, separated into the share of items that, in accordance with
other PFRSs:
i. Will not be reclassified subsequently to profit or loss; and
ii. Will be reclassified subsequently to profit or loss when specific conditions are
met.

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Yes. An entity shall present an analysis of expenses recognized in profit or loss using a
classification based on either their nature or their function within the entity, whichever provides
information that is reliable and more relevant. Entities are encouraged to present the analysis in
the statement(s) presenting profit or loss and other comprehensive income. Expenses are sub-
classified to highlight components of financial performance that may differ in terms of
frequency, potential for gains or loss and predictability. This analysis is provided in one of two
forms, namely, natural form and functional form.
An entity classifying expenses by function shall disclose additional information on the nature of
expenses, including depreciation and amortization expense and employee benefits expense.

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The natural form of analysis is the ‘nature of expense’ method. An entity aggregates expenses
within profit or loss according to their nature (for example, depreciation, purchases of materials,
transport costs, employee benefits and advertising costs), and does not reallocate them among
functions within the entity. This method may be simple to apply because no allocations of
expenses to functional classifications are necessary.

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An example of a classification using the nature of expense method is as follows:

Revenue X
Other income X
Changes in inventories of finished goods and work in progress X
Raw materials and consumables used X
Employee benefits expense X
Depreciation and amortization expense X
Other expenses X
Total expenses (X)
Profit before tax X