IAS 7 · Case studies (Step 3 of 5)
Practical case
Version of this content
IAS 7 as amended by IFRS 18
Applies to annual periods beginning on or after January 1, 2027. Early application permitted. Only together with early application of IFRS 18, which is permitted and must be disclosed (IFRS 18, para. C1).
Brenvik SA, a fictitious manufacturer of industrial pumps (240 employees), IFRS financial statements, year end 31 December, amounts in euros. Brenvik has no main business activity of investing or providing financing to customers (case data). It applies IFRS 18 for the first time to the period beginning on 1 January 2027, with no early application.
L1 · Guided · Published 2026, upcoming 2027
Version applicable to annual reporting periods beginning on or after 1 January 2027 (IAS 7, para. 64; IFRS 18, para. C1); earlier application permitted only together with IFRS 18. You compare, for 2026, the statement of cash flows as published (current version of IAS 7) and as it will be restated as the comparative in the 2027 statements (version amended by IFRS 18). Level 1: which version, which classifications. Level 2: reconciliation of operating profit, subtotals and comparison. The amounts, the categories of the statement of profit or loss and Brenvik's choices in the current version (interest paid and received and dividends received in operating activities, dividends paid in financing) are case data; those choices are presented as options of the current version, never as requirements. Teaching assumption: the 2026 cash flows are the same in both presentations, only the classifications change. Judgements are flagged.
Standard concerned: IAS 7 Statement of Cash Flows, current version and version amended by IFRS 18. Brenvik is preparing the switch to IFRS 18. First determine the applicable version, then the classification of each flow in the amended version. The questions are guided.
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Method
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Context · Dated fact of the file
Brenvik SA, a fictitious manufacturer of industrial pumps (240 employees), IFRS financial statements, year end 31 December, amounts in euros. Brenvik has no main business activity of investing or providing financing to customers (case data). It applies IFRS 18 for the first time to the period beginning on 1 January 2027, with no early application.
Initial event · L1·Published 2026, upcoming 2027 · Current stage
Standard concerned: IAS 7 Statement of Cash Flows, current version and version amended by IFRS 18. Brenvik is preparing the switch to IFRS 18. First determine the applicable version, then the classification of each flow in the amended version. The questions are guided.
Pieces added
New period · L2·Year 2026: published presentation and restated comparative · Upcoming: unlocks after the current stage
Conclusion · Upcoming: unlocks after the current stage
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Document 1Supporting document
First level: all the data is in the brief and the pieces of this level.
2 parts to answer, marked when you submit the level.
Find the useful facts in the pieces before concluding.
Part 1 · Classification · Recognition
Which version of IAS 7 applies to each of these presentations?
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The 2026 statement of cash flows as published
The statement of cash flows for 2027
The 2026 comparative presented in the 2027 statements
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Normative references