The five categories

Learning objectives

• Identify the five categories of the statement of profit or loss.L1
• Determine the category of an item of income or expense from the facts of a case.L1, L2

Normative references

• IFRS 18 §47The entity classifies income and expenses included in the statement of profit or loss in one of five categories: operating, investing, financing, income taxes and discontinued operations (criteria in paras. 52 to 68 and B65 to B76).

Original summaries of the paragraphs (reference register), never a quotation of the standard.

3 questions

• What are the five categories into which IFRS 18 classifies the income and expenses of the statement of profit or loss?L1
• All the income and expenses in the statement of profit or loss are classified in one of the five IFRS 18 categories.L1
• Flore SA, an industrial entity with no specified main business activity (case convention), records three items: (a) interest on a bank loan taken out to raise finance, (b) the proceeds from the sale of its goods, (c) an income tax expense. Which classification by category is correct?L2