June 2021 IAS 33 Earnings per Share

SCOPE
Applies to separate, individual, or consolidated F/S of an entity whose: If earnings per share (EPS) are voluntarily disclosed, calculate
• ordinary shares (or potential ordinary shares) are traded in a public market, or and disclose in accordance with this Standard.
• that files, or is in the process of filing, its F/S with securities regulator to issue its ordinary shares in a public market.

MEASUREMENT - BASIC EPS

Calculation Earnings Weighted Average Number of Shares
For the purpose of calculating basic EPS, the For the purposes of calculating basic EPS, the number of ordinary shares shall be the weighted average number of ordinary shares
P/L attributable to amounts attributable to ordinary equity holders outstanding during the period.
ordinary equity holders in respect of (a) P/L from continuing operations Calculation of weighted average number of shares outstanding during the period:
weighted average attributable to the parent entity, and (b) P/L
number of ordinary attributable to the parent entity, shall be: The number of ordinary The number of ordinary The number of days that the shares
shares outstanding shares outstanding at the Adjusted shares bought back or X are outstanding as a proportion of the
• the amounts in (a) and (b) adjusted for the issued during the period total number of days in the period
during the period beginning of the period By
after-tax amounts of preference dividends,
differences from the settlement of preference
shares, and other similar effects of preferred The weighted average number of ordinary shares outstanding during the period and for all periods presented shall be adjusted for
shares classified as equity. events, other than the conversion of potential ordinary shares, that have changed the number of ordinary shares outstanding with a
corresponding change in resources.
MEASUREMENT - DILUTED EPS
Earnings Weighted Average Number of Shares
For the purpose of calculating
diluted earnings per share, an For the purpose of calculating diluted earnings per share, an entity shall adjust P/L For the purpose of calculating diluted EPS, the number of ordinary shares shall
entity shall adjust P/L attributable attributable to ordinary equity holders as calculated for basic EPS, by the after-tax effect of: be:
to ordinary equity holders of the (a) any dividends or other items related to dilutive potential ordinary shares deducted in (a) the weighted average number of ordinary shares calculated for basic EPS,
parent entity, and the weighted arriving at P/L attributable to ordinary equity holders as calculated for basic EPS. plus:
average number of shares (b) any interest recognized in the period related to dilutive potential ordinary shares, and (b) the weighted average number of ordinary shares that would be issued on the
outstanding, for the effects of all (c) any other changes in income or expense that would result from the conversion of the conversion of all the dilutive potential ordinary shares into ordinary shares at
dilutive potential ordinary shares. dilutive potential ordinary shares. the beginning of the period or, if later, the date of the issue of potential
ordinary shares.

Dilutive Potential Ordinary Shares

Potential ordinary shares shall be treated as dilutive when, and only when, their conversion to ordinary shares would decrease EPS or increase loss per share from continuing operations.

Options, warrants and their equivalents
An entity shall assume the exercise of dilutive options
and warrants of the entity.
• the assumed proceeds shall be regarded as having
been received from the issue of ordinary shares at
the average market price of the ordinary shares
during the period.
• the difference between the number of ordinary
shares issued and the number of ordinary shares that
would have been issued at the average market price
during the period shall be treated as an issue of
ordinary shares for no consideration.
Convertible instruments
The dilutive effect of convertible instruments
shall be reflected in diluted EPS.
• Convertible preference shares are antidilutive
whenever the amount of the dividend on
such shares declared in or accumulated for
the current period per ordinary share
obtainable on conversion exceeds basic EPS.
• Convertible debt is antidilutive whenever its
interest (net of tax and other charges) per
ordinary share obtainable on conversion
exceeds basic EPS.
Contingently issuable shares
These are treated as outstanding and included in
the calculation of diluted EPS if the conditions are
satisfied (i.e. the events have occurred).
• they are included from the beginning of the
period (or date of contingent share agreement,
if later)
If the conditions are not satisfied, the number of
contingently issuable shares included is based on
the number of shares that would be issuable if the
end of the period were the end of the
contingency period.
Other
• When an entity has issued a contract that
may be settled in ordinary shares or cash at
the entity’s option, the entity shall presume
that the contract will be settled in ordinary
shares.
• For contracts that may be settled in ordinary
shares or cash at the holder’s option, the
more dilutive assumption shall be used.
• Contracts that require an entity to repurchase
its own shares are reflected in the calculation
of diluted EPS if the effect is dilutive.

This communication contains a general overview of the topic and is current as of June 15, 2021. This information is not a substitute for professional advice and we recommend that any decisions you take about the application or not of any of the information
presented be made in consultation with a qualified professional. Contact your local MNP representative for customized assistance with the application of this material. MNP LLP accepts no responsibility or liability for any loss related to any person's use of or r
eliance upon this material. © MNP LLP 2021. All rights reserved.
June 2021 IAS 33 Earnings per Share
MEASUREMENT - DILUTED EPS (continued)

Antidilution
Antidilution is an increase in EPS or a reduction in loss per share resulting from the assumption that convertible instruments are converted, that options or warrants are exercised, or ordinary shares are issued
upon the satisfaction of certain conditions.

PRESENTATION AND DISCLOSURE

Present with equal prominence, in the statement of Discontinued operations Other disclosures
comprehensive income, for every period presented, Basic and diluted amounts • The amounts used in the numerators in calculating basic and diluted EPS, and a reconciliation to amounts in the P/L.
basic, and diluted EPS for: of discontinued operations • The weighted average number of ordinary shares used in the denominator in calculating basic/ diluted EPS, and a
(a) P/L from continuing operations attributable to per share shall be reconciliation of the two amounts.
ordinary equity holders, and presented in the statement
• Instruments that could potentially dilute basic EPS in the future but weren’t included in the calculation of diluted EPS
(b) P/L attributable to ordinary equity holders for each of comprehensive income
because they were antidilutive.
class with different rights to share in P/L for the or in the notes.
• Description of significant subsequent event ordinary share transactions.
period.

This communication contains a general overview of the topic and is current as of June 15, 2021. This information is not a substitute for professional advice and we recommend that any decisions you take about the application or not of any of the information
presented be made in consultation with a qualified professional. Contact your local MNP representative for customized assistance with the application of this material. MNP LLP accepts no responsibility or liability for any loss related to any person's use of or r
eliance upon this material. © MNP LLP 2021. All rights reserved.