Here is a worked example of the financial statements being produced from the trial balance of a company. The principles applied in the construction of the statement are identical to those used to construct the statements of a sole trader. However, the requirements of IAS 1 mean that the format of the statement must comply with a prescribed layout.

Additional information:
1. The taxation due on the company’s profits for the year is £76,000.
2. Distribution costs accrued at 31 Dec 2029 total £8,000.
3. Administration costs prepaid at 31 Dec 2029 totalled £4,000.
4. Only £10,000 of the interest due on the debentures had been paid by the end of the year.
5. Inventory in trade at the year end totalled £76,000.
6. The company engaged in a bonus issue of shares during the year which is not recorded in the trial balance. The bonus issue was made on the basis of one new share for every four already held. Reserves were to be mentioned in the most distributable form.

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Rubytronic plc Trial balance as at 31 December 2029 DI Cr 000 000 Ordinary share capital (1 shares) Plant and equipment at cost 800 420 Depreciation on plant and equipment 95 Investments (non-current) 330 Property at cost 1,000 Depreciation on property 150 Inventories as at 1 Jan 2029 48 Revenue 1,100 Purchases 715 Dividends paid 87 Dividends received 28 Retained earnings 195 Distribution costs 105 Trade receivables 53 85 Trade payables 62 69 Accruals Administration costs Share premium 96 99 300 Cash and cash equivalents 81 10% Debentures 250 Interest paid 10 2.980 2.980