THE STATEMENT OF CHANGES IN EQUITY
This is a very important report because it explains the movements in the shareholder funds during the year and also acts as a link between the income statement and the balance sheet.
The report also shows the total gains or losses made by the company during the year. Some of these gains or losses may not be included in the income statement e.g. gains or losses on revaluation or PPE and investments (long -term)
The format of the statement of changes in equity is given as follows:
|
|
Preference share capital
|
Ordinary share capital
|
Share premium
|
Revaluation reserve
|
General reserve
|
Retained profits
|
TOTAL
|
|
|
£
|
£
|
£
|
£
|
£
|
£
|
£
|
|
i) Balance at 1.1
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
|
ii) Changes in a/c policy/correction of error
|
-
|
-
|
-
|
-
|
-
|
(x)
|
(x)
|
|
iii) Balance as restated (i +ii)
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
|
iv) Gain/losses on revaluation PPE
|
-
|
-
|
-
|
x
|
-
|
-
|
x
|
|
v) Transfer to retained profits on sale of PPE
|
-
|
-
|
-
|
(x)
|
-
|
x
|
-
|
|
vi) Gain losses on investment revaluation
|
-
|
-
|
-
|
x
|
-
|
-
|
x
|
|
vii) Foreign currency exchange gain/losses
|
-
|
-
|
-
|
x
|
-
|
-
|
x
|
|
viii) Net gains/losses directly reported in equity (iv + v +vi + vii)
|
-
|
-
|
-
|
x
|
-
|
x
|
x
|
|
ix) Profit for the period
|
-
|
-
|
-
|
-
|
-
|
x
|
x
|
|
x) Total gains/losses recognized during the year (viii + ix)
|
-
|
-
|
-
|
x
|
-
|
x
|
x
|
|
xi) Issue of shares
|
x
|
x
|
x
|
-
|
-
|
-
|
x
|
|
xii) Transfer to general reserve
|
-
|
-
|
-
|
-
|
x
|
(x)
|
-
|
|
xiii) Dividends: interim paid
|
-
|
-
|
-
|
-
|
-
|
(x)
|
(x)
|
|
xiv) Final proposed (If prop before year end)
|
-
|
-
|
-
|
-
|
-
|
(x)
|
(x)
|
|
xv) Balance as at 31.12 ( x + xi + xii + xiii)
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|