Apia – The International Accounting Standards Board (IASB) has issued IFRS 18 – Presentation and Disclosure in Financial Statements, a landmark reform that redefines how financial performance is presented globally. Sua ma Pauga – Chartered Accountants is proud to support this important development and confirms its attendance at the upcoming IFRS 18 Implementation Conference in London in June 2025.

IFRS 18 becomes effective for annual periods beginning on or after 1 January 2027, replacing IAS 1. It introduces structural changes to the statement of profit or loss to enhance comparability, transparency, and the relevance of financial information for investors, regulators, and stakeholders.

“IFRS 18 raises the global bar on how performance is presented,” said Tagaloa Faafouina Suá, Partner at Sua ma Pauga. “Its introduction will have ripple effects on both private and public sector reporting, including potential updates to IPSAS. We are committed to helping our clients prepare early.”

 Key Features of IFRS 18:

• Mandated presentation of operating profit and profit before financing and income tax
• Standardized classification of income and expenses into:
• Operating
• Investing
• Financing
• Requirements to disclose and reconcile Management Performance Measures (MPMs) to IFRS-defined subtotals
• Enhanced guidance on disaggregation of financial statement line items
• Focus on consistency across industries and jurisdictions

 Anticipated Impact on the Public Sector and IPSAS:

While IFRS 18 applies to private-sector entities, its influence is expected to extend into the public sector through future amendments to the International Public Sector Accounting Standards (IPSAS):

• IPSAS 1 – Presentation of Financial Statements will likely undergo revision to reflect IFRS 18’s clearer definitions of performance categories.
• The standardization of profit and loss categories could influence how public sector entities present cost recovery activities, grants, and operational outputs.
• Value-for-money reporting, increasingly required by donors and international agencies, will benefit from the disaggregation and clarity IFRS 18 promotes.
• Governments and state-owned enterprises may be encouraged to voluntarily align with IFRS 18 in mixed financial environments to improve transparency, especially where entities operate on commercial terms.

“As public accountability grows, the IPSAS Board will inevitably look to harmonize IPSAS 1 with the clarity IFRS 18 brings,” noted Nonu William Mauia, Audit Manager “We’re monitoring developments and advising our public sector clients accordingly.”

 Sua ma Pauga’s Preparedness Strategy:

Our firm is actively equipping clients for IFRS 18 and future IPSAS convergence by:

• Conducting technical training for both IFRS and IPSAS engagements
• Reviewing client templates and systems for disclosure readiness
• Offering impact assessments and tailored transition roadmaps
• Engaging in dialogues with regional institutions on IPSAS reform

We invite all clients—particularly state-owned enterprises, donor-funded entities, and large private-sector players—to engage with our advisory team to understand the implications of IFRS 18 and the expected IPSAS shifts that may follow.