EPS IAS 33

Question 1

Which entities are required to report earnings per share (EPS)?

Answer 1

• Only publicly accountable enterprises
  are required to report EPS
• Non-public entities reporting under IFRS
  are not required to report EPS

Question 2

How is basic EPS calculated?

Answer 2

Net earnings (loss) available to common shareholders*
- Divided by
Weighted average common shares outstanding** (WACSO)

*Equal to income (loss) less any dividends on preferred shares (for cumulative preferred shares deduct dividends owed and for non-cumulative, deduct dividends declared)

**Treasury shares (issued but not outstanding) are not included

**Additional shares resulting from stock splits and stock dividends are assumed to have been issued at the beginning of the earliest period presented.

Question 3

How is diluted EPS calculated?

Answer 3

Net earnings (loss) available to common shareholders + income
- Divided by
impact** of potential ordinary shares (POS)*
WACSO + share impact*** of potential ordinary shares (POS)

*Includes convertible bonds, convertible preferred shares, options or warrants

**Example is the interest that would not be payable if bonds are converted to common shares

***Number of additional shares that would be outstanding