All companies with listed ordinary shares are required to report earnings per share in accordance with IAS 33 Earnings per Share, in their interim and annual reports (including companies reporting under the UK GAAP standard FRS 102). 

Earnings per share is a well understood metric, which is widely used by companies and investors, however, some aspects of its calculation are not straightforward. 

The findings from the FRC’s Corporate Reporting Review (CRR) team’s routine monitoring of company reporting show that some of the main principles of IAS 33 are not always well understood or applied correctly.

The FRC said there was room for improvement in the way earnings per share are disclosed. Certain requirements of IAS 33 appeared to have been overlooked or not well understood by companies.