IAS 33 · Workpapers (Step 4 of 5)
Workpaper assignment
- Course
- Exercises
- Case studies
- Workpapers
- Exams
Retrospective restatement and presentation of earnings per share: comparatives, discontinued operations and reconciliations
Rights issue with a bonus element: adjustment factor, weighting of the year and restated comparative earnings per share
Section 1 of 8
Objective
Section brief
- What to document
- The engagement, its scope and the working mode chosen.
- Why
- A workpaper answers one precise question: framing it avoids off-topic work.
- How
- Read the objective and the assignment, then choose the mode (guided, semi-guided, professional).
- Expected result
- You know which question the workpaper must settle, and for which reporting date.
- Your role
- Preparer of the IAS 33 workpaper
- Level
- Advanced
- Estimated time
- ≈ 60 min
- Progress
- 0 / 4 steps done (review excluded)
Context
Hallorin SA (fictitious entity), a listed company, closes its books on 31 December 20X6. On 1 April 20X6 it made a rights issue at a price below the market price; in preparing the financial statements it also discovered an error in the 20X5 profit, corrected retrospectively. Management prepares basic earnings per share for 20X6 and the 20X5 comparative.
Assignment
Retrospective restatement of the 20X5 comparative
Purpose of the workpaper
Identify the events that change the number of shares with no change in resources, restate the number of shares and earnings per share of prior periods (adjustment factor, corrections of errors), compute earnings per share from continuing and discontinued operations, reconcile the basic and diluted numbers of shares, document the judgment on the price before detachment and prepare the draft presentation and note. Amounts and factors are case data; earnings per share is rounded to two decimals (case convention).
Questions of the file covered by this workpaper
- Restate the number of shares before the exercise of the rights.
- Compute the 20X5 profit attributable to the ordinary shares after the correction of the error.
- Compute basic earnings per share for 20X6, as published for 20X5 and restated for 20X5.
- Is the observed price before detachment an appropriate basis for the adjustment factor?
Documents in the file
Open the documents to pick out the relevant information.