STATEMENT OF FINANCIAL POSITION ANALYSIS

Security Analysis

1. STATEMENT OF FINANCIAL POSITION

2. Definition IS A FORMAL STATEMENT SHOWING THE THREE ELEMENTS COMPRISING THE FINANCIAL POSITION NAMELY ASSETS, LIABILITIES, AND EQUITY.

3. LIQUIDITY THE ABILITY OF ENTITY TO MEET CURRENTLY MATURING OBLIGATIONS SOLVENCY THE AVAILABILITY OF CASH OVER THE LONGER TERM TO MEET MATURING OBLIGATIONS

4. CURRENT AND NON – CURRENT DISTINCTIONS PAS 1, PARAGRAPH 6, PROVIDES THAT AN ENTITY SHALL PRESENT CURRENT AND NON – CURRENT ASSETS, AND CURRENT AND NON – CURRENT LIABILITIES, AS SEPARATE CLASSIFICATIONS IN THE STATEMENT OF FINANCIAL POSITION.

5. ASSETS AN ASSET IS DEFINED AS A RESOURCE CONTROLLED BY THE ENTITY AS A RESULT OF PAST EVENT AND FROM WHICH FUTURE ECONOMIC BENEFITS ARE EXPECTED TO FLOW TO THE ENTITY CHARACTERISTICS OF ASSETS CONTROLLED BY THE ENTITY RESULT OF A PAST EVENT PROVIDES FUTURE ECONOMIC BENEFIT THE COST OF THE ASSET CAN BE MEASURED RELIABLY

6. OPERATING CYCLE THE TIME BETWEEN THE ACQUISITION OF ASSETS FOR PROCESSING AND THEIR REALIZATION IN CASH OR CASH EQUIVALENT

7. PRESENTATION OF CURRENT ASSETS ORDER OF LIQUIDITY: CASH AND CASH EQUIVALENT FINANCIAL ASSETS AT FV THROUGH P/L, SUCH AS TRADING SECURITIES AND OTHER INVESTMENTS IN QUOTED EQUITY INSTRUMENTS TRADE AND OTHER RECEIVABLES INVENTORIES PREPAID EXPENSES

8. NONCURRENT ASSETS PAS 1, PARAGRAPH 66, SIMPLY STATES THAT “AN ENTITY SHALL CLASSIFY ALL OTHER ASSETS NOT CLASSIFIED AS CURRENT AS NONCURRENT ASSETS” NONCURRENT ASSETS INCLUDE THE FF: PROPERTY, PLANT AND EQUIPMENT LONG – TERM INVESTMENT INTANGIBLE ASSETS OTHER NONCURRENT ASSETS

9. LIABILITIES DFINED AS A PRESENT OBLIGATION OF AN ENTITY ARISING FROM PAST EVENT, THE SETTLEMENT OF WHICH IS EXPECTED TO RESULT IN AN OUTFLOW FROM THE ENTITY OF RESOURCES EMBODYING ECONOMIC BENEFITS. CHARACTERISTICS OF LIABILITY ARE: PRESENT OBLIGATION OF A PARTICULAR ENTITY ARISES FROM PAST EVENT THE SETTLEMENT OF THE LIABILITY REQUIRES AN OUTFLOW OF RESOURCES EMBODYING ECONOMIC BENEFITS

10. CURRENT LIABILITIES PAS 1, PARAGRAPH 69, PROVIDES THAT AN ENTITY SHALL CLASSIFY A LIABILITY AS CURRENT WHEN: THE ENTITY EXPECTS TO SETTLE THE LIABILITY WHITIN THE ENTITY’S NORMAL OPERATING CYCLE THE ENTITY HOLDS THE LIABILITY PRIMARILY FOR THE PURPOSE OF TRADING DUE TO BE SETTLED WITHIN 12 MONTHS AFTER THE REPORTING PERIOD THE ENTITY DOES NOT HAVE AN UNCONDITIONAL RIGHT TO DEFER SETTLEMENT OF THE LIABILITY FOR AT LEAST 12 MONTHS AFTER THE REPORTING PERIOD

11. PRESENTATION OF CURRENT LIABILITY PAS 1, PARAGRAPH 54, THAT AS A MINIMUM, THE FACE OF THE FINANCIAL POSITION SHALL INCLUDE THE FOLLOWING LINE ITEMS FOR CURRENT LIABILITIES: TRADE AND OTHER PAYABLES CURRENT PROVISIONS SHORT – TERM BORROWING CURRENT PORTION OF LONG – TERM DEBT CURRENT TAX LIABILITY

12. NONCURRENT LIABILITIES PAS 1, PARAGRAPH 69, SIMPLY STATES THAT “ALL LIABILITIES NOT CLASSIFIED AS CURRENT LIABILITIES ARE CLASSIFIED AS NONCURRENT LIABILITIES: EXAMPLES OF NONCURRENT LIABILITIES NONCURRENT PORTION OF LONG – TERM DEBT FINANCE LEASE LIABILITY DEFERRED TAX LIABILITY LONG – TERM OBLIGATIONS TO ENTITY OFFICERS LONG – TERM DEFERRED REVENUE

13. EQUITY MEANS “NET ASSETS” OR TOTAL ASSETS MINUS LIABILITIES RETAINED EARNINGS CLASSIFICATION APPROPRIATED RETAINED EARNINGS UNAPPROPRIATED RETAINED EARNINGS

14. REVALUATION SURPLUS TREASURY SHARES RESERVES

15. FORMS OF STATEMENT OF FINANCIAL POSITION REPORT FORM ACCOUNT FORM