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COMPARATIVE ANALYSIS · IFRS 18 × REVISED SYSCOHADA IFRS 18 – Revised SYSCOHADA: two views of the income statement What brings the two frameworks together, what sets them apart, and what it means for listed companies in the OHADA region from 2027. |
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KEY POINTS IN 30 SECONDS
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IFRS 18 comes into force on 1 January 2027, replacing IAS 1 and reshaping the income statement of every company that reports under IFRS. In the OHADA region, this is far from a theoretical question: it is a major issue for finance departments, auditors and consolidation teams.
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LEGAL BASIS Under Article 8, paragraph 4, of the Uniform Act on Accounting Law and Financial Reporting (AUDCIF), OHADA requires dual reporting: all entities that are listed or that raise funds through public offerings must prepare and present annual financial statements under IFRS, in addition to their financial statements prepared under SYSCOHADA. |
Two frameworks, two philosophies
IFRS 18 and the revised SYSCOHADA are different in nature. IFRS 18 is a principles-based presentation standard: it sets a minimum structure and leaves room for judgement, guided by the concept of materiality. SYSCOHADA is a complete accounting system, with a mandatory chart of accounts and prescribed financial statement templates in which every line carries a reference code (TA, RA, XA…).
Their coexistence is nevertheless a legal reality under the AUDCIF provision mentioned above. The consolidated financial statements of these entities are prepared under IFRS.
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2018 Revised SYSCOHADA in force for individual financial statements |
2019 IFRS financial statements mandatory for listed entities |
2027 IFRS 18 comes into force |
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IN PRACTICE A company listed on the Central African Stock Exchange (BVMAC) or on the BRVM will apply IFRS 18 in its IFRS financial statements from 2027, while continuing to prepare its SYSCOHADA financial statements. |
Structural comparison
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Criterion |
IFRS 18 |
Revised SYSCOHADA |
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Approach |
Principles, judgement and materiality |
Standardised templates with reference codes |
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Presentation logic |
Three main categories: operating, investing and financing |
Distinction between ordinary activities (operating and financial transactions) and non-ordinary activities (HAO) |
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Operating expenses |
By nature, by function or mixed |
By nature only |
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Structure of profit or loss |
5 categories: operating, investing, financing, income taxes, discontinued operations |
Ordinary activities (operating and financial), non-ordinary activities (HAO), employee profit-sharing, income tax |
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Required subtotals |
Operating profit, profit before financing and income taxes, profit or loss |
Nine cascading subtotals, from trading margin to net profit |
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Investment income and finance costs |
Separated: investing on one side, financing on the other |
Combined in the financial result |
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Non-recurring items |
No dedicated category, usually in operating |
Isolated in the HAO result |
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Management-defined performance measures |
Strict framework for MPMs, such as adjusted EBITDA, which must be reconciled to IFRS subtotals in an audited note |
No equivalent: financial reporting relies on the standardised, fixed intermediate subtotals of the framework |
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Comprehensive income |
Statement of comprehensive income (OCI) |
No equivalent statement |
The main challenges in practice
01 Comparability: through uniformity or through structure
SYSCOHADA achieves comparability through uniformity: every company fills in the same template, line by line. IFRS 18 pursues the same goal by a different route, requiring defined categories and subtotals while leaving considerable freedom within them. In a sense, IFRS 18 brings IFRS closer to what SYSCOHADA has long practised: subtotals defined by the framework rather than an “operating profit” specific to each company.
02 The richness of intermediate subtotals
SYSCOHADA is more detailed. It requires a cascade of subtotals: trading margin, revenue, value added, gross operating surplus (EBE), operating profit, financial result, profit from ordinary activities, HAO result and net profit. IFRS 18 requires only two intermediate subtotals.
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POINT OF CONVERGENCE Under paragraph 118 of IFRS 18, operating profit before depreciation, amortisation and impairments is not a management-defined performance measure. A gross operating surplus calculated strictly on that basis can therefore appear in IFRS 18 financial statements without going through the MPM note. |
03 The treatment of non-recurring items
This is the most significant difference in practice. SYSCOHADA has a genuine “non-ordinary activities” category, which preserves a clear reading of recurring performance. IFRS 18 has no such category.
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WATCH OUT With identical data, a company's IFRS 18 operating profit will often differ from its SYSCOHADA operating profit. A company that wishes to report a result “excluding non-recurring items” will have to present it as an MPM, with a detailed reconciliation in the notes (reconciling items, tax effects and effects on non-controlling interests). |
04 The consolidation and ERP challenge (dual reporting)
For audit firms and entities that issue IFRS financial statements, the transition will be first and foremost an IT and organisational project. Mapping SYSCOHADA accounts to the new IFRS 18 categories will require an in-depth update of accounting ERP systems to meet the disaggregation requirements.
05 Line items with no equivalent
Employee profit-sharing, which has its own line in SYSCOHADA, is a personnel expense under IFRS and therefore falls within the operating category. SYSCOHADA has neither a statement of comprehensive income nor a dedicated line for discontinued operations, both of which exist under IFRS.
Implications for the companies concerned
For companies subject to both frameworks, IFRS 18 opens a transition project that should be launched without delay.
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2026-2027 ROADMAP
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GOOD NEWS The presentation of expenses by nature required by SYSCOHADA is fully compatible with IFRS 18. It spares companies the detailed note on the nature of expenses required of those that present expenses by function. |
Conclusion
IFRS 18 and the revised SYSCOHADA share the same objective: making performance readable and comparable. The former achieves it through a mandatory yet flexible structure, the latter through uniform templates and detailed subtotals.
For listed companies in the OHADA region, the challenge for 2027 is not to choose between the two, but to organise a reliable, well-documented bridge from one to the other.
SOURCES
- OHADA – AUDCIF (Art. 8, para. 4): Uniform Act on Accounting Law and Financial Reporting, adopted in Brazzaville on 26 January 2017 (OHADA Official Journal, special issue of 15 February 2017)
- IFRS Foundation – IFRS 18 Presentation and Disclosure in Financial Statements – https://www.ifrs.org/issued-standards/list-of-standards/ifrs-18-presentation-and-disclosure-in-financial-statements/
- OHADA – Uniform Act on Accounting Law and Financial Reporting (AUDCIF) – https://www.ohada.org/en/uniform-act-relating-to-accounting-law-and-financial-information-audcif/
- OHADA – Technical opinions on the application of the AUDCIF (in French) – https://www.ohada.com/uploads/actualite/4422/Avis-techniques-relatifs-a-l-AUDCIF.pdf
- Deloitte Avocats – Overview of the AUDCIF and effective dates (in French) – https://blog.avocats.deloitte.fr/acte-uniforme-relatif-droit-comptable-a-linformation-financiere/
This article is for educational purposes only and does not constitute accounting or legal advice.
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