2018 Illustrative Consolidated Financial Statements (Full PFRS)

This publication presents illustrative consolidated financial statements for a fictitious listed company, VALUE PFRS Plc. The financial statements comply with Philippine Financial Reporting Standards (PFRS) that apply to financial years commencing on or after January 1, 2018.

We have attempted to create a realistic set of financial statements for VALUE PFRS Plc, a corporate entity that manufactures goods, provides services and holds investment property. However, as this publication is a reference tool, we have not removed any disclosures based on materiality. Instead, we have included illustrative disclosures for as many common scenarios as possible. Please note that the amounts disclosed in this publication are purely for illustrative purposes and may not be consistent throughout the publication.

New disclosure requirements

Most companies will have to make changes to their disclosures this year to reflect the adoption of PFRS 9 Financial Instruments and PFRS 15 Revenue from Contracts with Customers. This publication shows how the adoption of these standards may affect a corporate entity. Note 26 provides example disclosures which explain the impact of the changes in accounting policy. There are also many new disclosures illustrated throughout the publication, in particular in note 3, note 7, note 12 and note 25. You can find new or revised disclosures by looking for shading in the reference column.

In compiling the illustrative disclosures, we have made a number of assumptions in relation to the adoption of PFRS 9 and PFRS 15. In particular:

PFRS 9 is generally adopted without restating comparatives, with the exception of certain aspects of hedge accounting.
PFRS 15 is adopted retrospectively without using the practical expedient for completed contracts and contract modifications.

For further specific assumptions made, please refer to the commentary to note 26.

The other amendments to standards that apply from January 1, 2018 and that are unrelated to the adoption of PFRS 9 and PFRS 15 are primarily clarifications, see Note 25. We have assumed that none of them required a change in VALUE PFRS Plc’s accounting policies. However, this assumption will not necessarily apply to all entities. Where there has been a change in policy that has a material impact on the reported amounts, this would also need to be disclosed in note 26.

The new leasing disclosures, applicable when an entity has adopted PFRS 16 Leases as a lessee, are illustrated in Appendix D.
While the IASB issued a revised Conceptual Framework for Financial Reporting in March 2018 which will be used immediately by the Board and Interpretations Committee in developing new pronouncements, preparers will only commence referring to the new framework from January 1, 2020. We have therefore continued referring to the existing framework in this publication.

Early adoption standards

VALUE PFRS Plc generally adopts standards early if they clarify existing practice but do not introduce substantive changes. These include standards issued by the IASB as part of the improvements programme such as the Annual Improvements to PFRS Standards – 2015-2017 Cycle.

As required under PFRS, the impacts of standards and interpretations that have not been early adopted and that are expected to have a material effect on the entity are disclosed in accounting policy note 25(a). A summary of all pronouncements relevant for annual reporting periods ending on or after December 31, 2018 is included in Note 25. For updates after the cut-off date for our publication please see www.pwc.com/ifrs.

Summary of standards, amendments and interpretations effective from annual periods beginning on or after January 1, 2018 can be found in the download section below.