IFRS 1

Summary 
This standard applies when an entity first adopts International Financial Reporting Standards (IFRSs) in its annual financial statements. The IFRS financial statements must include an explicit and unreserved statement of compliance with IFRSs.

The standard also applies to interim financial reports for part of the period covered by its first IFRS financial statements.

IFRSs include all International Financial Reporting Standards, International Accounting Standards and Interpretations adopted by the International Accounting Standards Board (IASB).

The financial statements will include comparative information for a prior period or periods. The ‘date of transition’ to IFRSs is the beginning of the earliest period for which full comparative information is presented.

For example, assume an entity presents comparative information for one year and its first IFRS financial statements are for the year ended 31 December 2009. The date of transition will be 1 January 2008 (equivalent to close of business on 31 December 2007).

The financial statements and comparative information are prepared and presented in compliance with IFRSs as at the end of the reporting period (31 December 2009). The financial statements include only those assets and liabilities that qualify for recognition under IFRSs. The assets and liabilities are measured in accordance with IFRSs. There are some exemptions and exceptions available.

The same accounting policies are used throughout all periods presented in the first IFRS financial statements. The accounting policies may differ from those used immediately before adopting IFRSs (previous GA AP). Changes in the accounting policies do not affect profit.

The financial statements must explain how transition from previous GA AP to IFRSs affected the entity’s reported financial position, financial performance and cash flows.