System Close:

• This is the initial step where all financial transactions for the period are reviewed to ensure they are accurately recorded in the accounting system. Balances are checked, and the accounting books for that specific period are formally closed.

Trial Balance Review:

• Once the books are closed, a Trial Balance report is generated from the accounting system. This report lists all account balances. The key check here is verifying that the total debits equal the total credits. Any discrepancies must be investigated and corrected.

Movement Schedules:

• Detailed schedules are created for various account balances (like property, plant & equipment, or provisions). These schedules show the opening balance, additions, disposals, depreciation/amortization (if applicable), and closing balance. They must reconcile (tie back) to the final Trial Balance figures and provide supporting detail for the main financial statements.

Comparatives:

• Financial statements require comparison to the prior period. This step involves bringing forward the closing balances from the previous year's financial statements to serve as the opening balances for the current year's comparative figures. This helps users see trends and understand performance relative to the past.

Statement of Financial Position (Balance Sheet):

• This statement is prepared to show the company's financial position at the end of the reporting period. It lists the company's assets, liabilities, and equity, adhering to the fundamental accounting equation (Assets = Liabilities + Equity). Formatting and presentation guidelines, particularly from IAS 1, are followed.

Income Statement (Profit & Loss Statement):

• This statement summarizes the company's financial performance over the reporting period. It presents revenues earned, costs incurred (expenses), and ultimately calculates the net income or net loss. Guidance from IAS 1 (Presentation) and IAS 8 (Accounting Policies, Changes in Estimates and Errors) is relevant here.

Cash Flow Statement & Equity Schedule:

• The Cash Flow Statement tracks the movement of cash during the period, categorizing inflows and outflows into Operating, Investing, and Financing activities (as per IAS 7).

• Simultaneously, a schedule detailing the changes in equity from the beginning to the end of the period is compiled (often called the Statement of Changes in Equity).

Disclosure and Notes:

• These are crucial components providing supplementary information. Comprehensive notes are drafted to explain the accounting policies used, significant judgments and estimations made by management, breakdowns of items in the main statements, and other relevant details needed for users to fully understand the financials (referencing standards like IAS 10 - Events after Reporting Period, IAS 24 - Related Party Disclosures).

Other References:

• This step involves ensuring that requirements from other specific accounting standards have been considered and incorporated where relevant. Examples given include Segment Reporting (IFRS 8), Fair Value Measurement disclosures (IFRS 13), and potentially others depending on the company's activities.

Audit Clearance:

• The final stage involves working with external auditors. This includes providing them with all necessary documentation, answering their queries, and obtaining their final audit report and clearance letter. Authorized individuals within the company then review and formally sign the audited financial statements.