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IAI Actuarial Core Principles · Business Finance · Regulation of financial reporting of incorporated entities

Under the Companies Act 2013, which of the following is a component of the financial statements that a company must prepare for a financial year?

Financial statements under the Companies Act 2013 comprise the balance sheet, statement of profit and loss, cash flow statement where applicable, statement of changes in equity where applicable, and notes. The directors' report and auditor's report are separate documents attached to them.

  1. ABalance sheet, statement of profit and loss, cash flow statement (where applicable), statement of changes in equity and notesCorrect
  2. BOnly the balance sheet and directors' report
  3. COnly the statement of profit and loss and the auditor's report
  4. DBalance sheet and a forecast of next year's profits
  5. Statement of profit and loss and the corporate governance report

Explanation

Section 2(40) of the Act defines financial statements to include the balance sheet, the statement of profit and loss, the cash flow statement (for companies required to prepare it), the statement of changes in equity where applicable, and explanatory notes. The directors' report and auditor's report are separate documents, not components of the financial statements.

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