AGGREGATION AND DISAGGREGATION OF FINANCIAL STATEMENT ITEMS UNDER IFRS AND PREVENTION OF THE ETHICAL RISKS

Abstract

This article examines the methodological framework of financial statement structuring under IFRS 18, highlighting a paradigm shift from formal grouping to a systematic process of aggregation and disaggregation based on similar and dissimilar characteristics of items. The study introduces a logic-semantic model establishing a cohesive link between primary financial statements and notes. Using the aggregation and disaggregation principles according to IFRS 18 and IFRS Practice Statement 2, the model of presenting a structured summary logically unfolds into granular data intended for notes creation. This transition ensures that primary statements remain concise and scannable, while the notes provide the necessary depth and understanding. Such a structure effectively prevents the "obscuring" of significant information through excessive aggregation or the inclusion of irrelevant details. Particular attention is paid to identifying and mitigating ethical risks inherent in the professional judgments applied when using these principles of aggregation and disaggregation. The author systematizes the threats that may arise and the appropriate precautions, based on IESBA Code. The research also outlines prospects for adapting these concepts within International Public Sector Accounting Standards (IPSAS). A key challenge identified is the transformation of highly detailed cash-based budgetary data, specifically the Economic Classification of Expenditures (KEKV) in Ukraine, into accrual-based expense items. The need for automated mapping and decision-making algorithms to reconcile rigid budget controls with financial transparency, for enhancing public accountability and resource management efficiency, is identified. Strengthening the intersection of IFRS 18 and the Code of Ethics in professional education is essential for accountants and users of financial statements. Systematic harmonization of financial reporting structures across both corporate and public sectors will foster a more reliable information environment and increase stakeholder confidence in financial disclosures.