Question

Write 2 t0 3 pages of a recent company of your choice on financial statement restatement & ethics.

Answer 1

On the 16th April 2013 Barclays PLC published ‘Group Reporting Changes’ which detailed the impacts of the adoption of IFRS 10 Consolidated Financial Statements (“IFRS 10”) and IAS 19 Employee Benefits (Revised 2011) (“IAS 19 Revised 2011”). It also described the impact to the Group’s segmental results of the allocation of elements of the Head Office results to businesses and portfolio restatements between businesses. Changes were effective from 1st January 2013 and were consequently applied in the preparation of the 2013 Interim Results Announcement. Basis of preparation of the restatement document This restatement document consists of financial statements for the year ended 31 December 2012 to provide historical financial information to users on a basis consistent with Barclays accounting policies adopted for the Interim Results Announcement for the 6 months ending 30 June 2013. The resulting changes to previously presented financial statements are as follows, consistent with the transition guidance in the relevant standards: In addition to these changes of accounting policy, new disclosures relating to offsetting financial assets and financial liabilities arising from the revisions to IFRS 7 Financial Instruments: Disclosures have been provided as at 31 December 2012 and 31 December 2011. The following have not been included in the restatement document: More information about the financial effect of the restatements is provided below. Accounting restatements IAS 19 (Revised 2011) and IFRS 10 became effective on 1 January 2013 and result in the restatements to the Barclays PLC results for the years ended 31 December 2010, 2011 and 2012. The 2012 results restatement reflects the application of IAS 19 and IFRS 10, whilst the 2011 and 2010 results restatement reflects only the application of IAS 19, consistent with IFRS 10’s transition relief guidance. IFRS 10 IFRS 10 replaced requirements in IAS 27 Consolidated and Separate Financial Statements and SIC 12 Consolidation – Special Purpose Entities. This introduced new criteria to determine whether entities in which the Group has interests should be consolidated. The implementation of IFRS 10 resulted in the Group consolidating some entities that were previously not consolidated and deconsolidating some entities that were previously consolidated, principally impacting the consolidation of entities in the Investment Bank with credit market exposures. IAS 19 The Group adopted IAS 19 (Revised 2011) from 1 January 2013 which, amongst other changes, requires actuarial gains and losses arising from defined benefit pension schemes to be recognised in full. Previously the Group deferred these over the remaining average service lives of the employees (known as the ‘corridor’ approach). IFRS 11 In addition to the above, the Group also adopted IFRS 11, Joint Arrangements, which replaced IAS 31 Interests in Joint Ventures from 1 January 2012. The financial impact was immaterial. 4 Barclays PLC Restated Financial Statements 2012 • The financial statements have been restated as if IAS 19 (Revised 2011) had been in effect for all periods presented. • Results have been restated for IFRS 10 from 1 January 2012. Reserves have been restated for the impacts of the standard on the Group’s assets and liabilities on this date. • The segmental disclosures required by IFRS 8 have also been restated for all periods presented to reflect changes made in 2013 to the allocation of Head Office results to businesses and portfolio restatements between the businesses. • Disclosures that will be required by IFRS 13 Fair Value Measurement as this standard does not require these disclosures to be provided on a retrospective basis. • Disclosures that will be required by IFRS 12 Disclosure of Interests in Other Entities to be presented in the financial statements for the year ending 31 December 2013 have not been included in the restatement document as these disclosures were not applicable under IAS 34 and were therefore not provided in the half year results announcement for the period ended 30 June 2013 as they were not part of the accounting policies adopted at that date. Comparative disclosures in respect of unconsolidated structured entities are not required by the standard in the year of first adoption. • Adjustments or disclosures in relation to any post balance sheet events, that have occurred between 5 March 2013 (the date of the approval of the 31 December 2012 financial statements) and 29 August 2013