What is www.theauditors.ai?

www.theauditors.ai supports audit work with 626 pages for client requests, files, risk reviews, IFRS tools, VAT checks, and compliance reporting.

What does IFRS 18 change?

IFRS 18 replaces IAS 1 and restructures the income statement into operating, investing and financing categories with two required subtotals — operating profit or loss, and profit or loss before financing and income taxes. It also brings management-defined performance measures into the notes, strengthens aggregation and disaggregation principles, and fixes the starting point of the indirect-method cash flow statement.

What is a management-defined performance measure?

It is a subtotal of income and expenses used publicly to communicate management's view of performance that is not a subtotal specified by IFRS. Where a measure meets the definition, IFRS 18 requires it to be disclosed in a single note, reconciled to the most directly comparable IFRS subtotal, with an explanation of why it is useful and how it is calculated.

Do I still get a choice about presenting expenses by nature or by function?

The basis must be the one that gives the most useful summary of operating performance rather than simply past practice, applied consistently to similar items. Where a function-based or mixed presentation is used, specified nature-based amounts — including depreciation, amortisation and employee benefits — must be disclosed in the notes.

Why does a specified main business activity matter?

Entities that invest in assets, or provide financing to customers, as a main business activity classify certain income and expenses differently between the three categories. That assessment has to be made and documented before classification, because it changes what belongs in operating.

Does this checklist confirm our statements comply with IFRS 18?

No. It reviews selected presentation and disclosure areas from your answers only. No financial statements or note disclosures were reviewed, it is not an audit or a review, and it is not accounting advice. Where nothing is flagged, no issue was identified from the information you provided.

IFRS 18 Presentation Checker | New Income Statement Rules

How to answer

Answer Yes only where the presentation or disclosure is actually in the financial statements you are reviewing. This checklist never concludes that statements comply with IFRS 18 — where nothing is flagged it reports that no issue was identified from the information provided.

Checklist IFRS18-2026.08

Progress0 of 26 answered

Is income and expense classified into the operating, investing and financing categories?

Is the operating category used as the default for items not classified in investing or financing?

Are income and expenses from investments in associates and joint ventures presented in the investing category?

Are interest and other costs of financing presented in the financing category?

Have you considered whether the entity has a specified main business activity that changes the classification of some items?

Is the classification approach applied consistently between periods, with comparatives restated where it changed?

Answer at least one question to see your result.

Frequently asked questions

You may also find useful

IFRS Compliance Checklist

Broader IFRS presentation and disclosure review.

Audit Readiness Checklist

Are your records and documentation ready for an audit?

Internal Control Assessment

Score your control environment and see the highest-risk gaps.

Financial Ratio Analyzer

Liquidity, profitability, leverage and efficiency ratios.

Request an IFRS 18 readiness review

Want a professional review?

Send us your details and a specialist will review your calculation with you — free initial consultation.

This calculator provides indicative results based on the figures you enter. It is not financial, tax, legal, audit, valuation or investment advice, and it is not a formal report of any kind. Results depend entirely on your inputs and assumptions. Please seek professional advice before acting.