IFRS 18: what changes in your financial statements

IFRS 18 Presentation and Disclosure in Financial Statements applies to annual periods beginning on or after 1 January 2027 and replaces IAS 1. It does not change how income and expenses are measured; it changes how they are presented in profit or loss, and adds new disclosures.

1. What changes in the income statement

2. Management-defined performance measures

These are subtotals of income and expenses that management uses in public communications, such as shareholder reports or investor presentations. IFRS 18 requires them to be disclosed in the notes to the financial statements.

3. The timeline in Saudi Arabia

1. 1

   26 December 2024

   SOCPA endorsed IFRS 18 for use in Saudi Arabia.

2. 2

   Periods beginning on or after 1 April 2026

   Listed joint-stock companies disclose a preliminary assessment of the expected impact in their interim and annual statements, per the Capital Market Authority.

3. 3

   During 2026

   Listed companies may announce IFRS 18 statements on the Tadawul website, alongside their statutory statements under IAS 1.

4. 4

   1 January 2027

   Mandatory application for annual periods beginning on or after this date, retrospectively.

4. Who applies it

• Listed joint-stock companies and other publicly accountable entities, which must use full IFRS as endorsed in Saudi Arabia.
• Any other company reporting under full IFRS, including unlisted joint-stock companies and LLCs.
• Companies using the IFRS for SMEs Standard do not apply IFRS 18; the new edition of their standard takes effect on 1 January 2027.

5. Checklist for the finance team

1. Confirm your accounting framework: full IFRS or IFRS for SMEs.
2. Review the current income statement and identify items that will move between categories.
3. Map the chart of accounts to the new categories so the figures come straight from the system.
4. List the performance measures you publish to shareholders and investors.
5. Prepare the comparative year on the new basis, because IFRS 18 applies retrospectively.
6. Listed companies: prepare the preliminary impact disclosure and report progress to the board.
7. Agree the timetable and supporting files with your auditor early.

6. How Entry Post helps

Entry Post prepares the IFRS 18 impact study, restates the comparatives, and builds the disclosure templates and the board and audit-committee briefing. Most impact studies take 4–6 weeks. If we are your auditor, our role stays within what independence rules allow.