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IAS 33 Earnings per Share — A practical guide

Published on: 17 Mar 2015

This practical guide has been put together to help you navigate the complexities, avoid the common pitfalls and ease the process when it comes to calculating earnings per share, or EPS as it is commonly known.  It includes a detailed step by step guide to calculating both basic and diluted EPS, as well as two worked examples dealing with scenarios that often catch people out.

Although IAS 33 Earnings per Share has not changed for several years, it is still a standard that causes headaches for preparers of financial statements and contains more than a few traps for the unwary.  The practical difficulties experienced in calculating earnings per share often stem from the fact that IAS 33 is very rules-based.  This lack of an underlying principle means that the calculations required can sometimes give counter-intuitive results, which in turn causes uncertainty for preparers as to whether they have applied the requirements correctly.

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