IAS-33 Earnings per Share

It is important that the user of the financial statement:

-

are able to compare the EPS of different entities and

are able to compare the EPS in same entity in different accounting period

Scope of IAS 33
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IAS 33 applies to entities whose ordinary shares are publicly traded.

Publicly traded entities which present both parent and consolidated financial
statements are
only required to present EPS based on the
consolidated figures.

Basic of EPS: Earning/Shares. Here earning means, profit after tax less noncontrolling interest and irredeemable preference shares dividend, and share means
weighted average number of ordinary share outstanding during this period.
Bonus Issue:
A bonus issue (or capitalisation issue or scrip issue):
-

does not provide additional resources to the issuer

means that the shareholder owns the same proportion of the business before
and after the issue.

In the calculation of EPS:

-

the bonus shares are deemed to have been issued at the start of the year
comparative figures are restated to allow for the proportional increase in share
capital caused by the bonus issue.
Note: If you have a issue of shares at full market price and a bonus issue, you
apply a bonus fraction from the start of the year up to the date of the bonus
issue. For example, if the bonus issue was 1 share for every 5 owned, the bonus
fraction would be 6/5 (as everyone who had 5 shares now has 6).
Example: Company ABC current share capital comprise 1,00,000 share @ 100 tk
each share, after satisfactory performance of last year board of director declared
3 bonus share per 10 share each.