IASB October 2007

The Board confirmed that capital management disclosures should be limited to equity and financial liabilities that an entity manages as capital; those disclosures should not include items included in the operating category. It tentatively decided that net presentation of cash receipts and payments related to items currently classified as cash equivalents should be permitted in the statement of cash flows and that the application guidance in paragraph 24(a)─(c) of IAS 7 Statement of Cash Flows should be retained.

The Board also made the following tentative decisions:

• for the purposes of the initial discussion document on financial statement presentation, the classification of dividends payable on ordinary shares and related changes in the financial statements should be based on the current classification of dividends payable as a liability. Thus, dividend payments on ordinary shares would not be classified in the equity section in the statement of cash flows.
• foreign currency translation adjustments related to consolidated subsidiaries and proportionately consolidated joint ventures should be presented in a new separate section in the statement of comprehensive income, rather than in the operating category. Foreign currency translation adjustments related to equity method investments should be classified in the category in which the equity method investment is classified in the statement of financial position.

The Board tentatively decided that, in principle, the effects of basket transactions (single transactions that involve multiple assets, or a combination of assets and liabilities, that would be classified in more than one category under the working format) should be allocated to the multiple categories in which the related assets and liabilities are classified. It directed the staff to develop some allocation methods for discussion at a future meeting.