The key financial statements required by both the IFRS and GAAP are similar, but the ways in which the numbers are calculated sometimes differ. Also, IFRS standards require only two years of data for the income statements, changes in equity, and cash flow statements, whereas GAAP requires three years of data for SEC registrants.
Balance sheet
GAAP standards require assets, liabilities, and equity to be presented in decreasing order of liquidity. The balance sheet is generally presented with total assets equaling total liabilities and shareholders’ equity.
IFRS guidelines don't require any specific format, but entities are expected to present current and noncurrent assets and current and noncurrent liabilities as separate classifications on their balance sheets, except when liquidity presentation provides more relevant and reliable information.
After a review of several balance sheets of European companies, they didn't seem to be any significant differences in the way the balance sheet was presented. The basic format of the GAAP balance sheet seems to be pretty well accepted globally.
Income statement
The IFRS guidelines don't prescribe a standard format, but GAAP does require the use of a single-step or multistep format. The IFRS prohibits the use of the category “extraordinary items,” but GAAP allows an extraordinary line item on the income statement.
Extraordinary items are defined as being both infrequent and unusual. For example, when goodwill is shown as a negative item, it's listed as an extraordinary item on the income statement.
In 2007 and 2008, as financial institutions put goodwill in this category from acquisitions gone bad because of the mortgage mess, they usually put it down as an extraordinary item. By separating these items from operating income results, a company can make its net income look better.
Writing down goodwill doesn't involve the use of cash. Cash is used when a company buys another company for more than the value of its assets. If this happened many years ago, it doesn't impact the current year's operating results.
Statement of recognised income and expense (SoRIE)
The SoRIE is unique to IFRS, but the information is commonly shown at the bottom of the income statement in companies filing reports under the rules of GAAP, or it's presented on a separate document called the statement of changes in shareholders' equity. In either case, the information presents the total income and accumulated income over time.
Note: Note that recognised is spelled with an s instead of a z. The British spelling is used because U.S. corporations don't use this statement; it's primarily for companies in Europe that use a British spelling.
Statement of changes in shareholders’ equity
This statement is similar in both the IFRS and GAAP standards, unless a non-U.S. company files a SoRIE. This statement isn't required as a separate document under GAAP rules. A company can choose to present the information about changes in shareholders’ equity as part of the notes to the financial statements.
Cash flow statement
In both IFRS and GAAP rules, this statement is presented with similar headings. The IFRS gives limited guidance on what information the statement must include.
GAAP gives more specific guidance for which categories must be included in each section of the statement. Statements can be prepared using the direct or indirect method under either the IFRS or GAAP.