Which of the following is correct in calculating the number of shares for diluted earnings per share?
A. The number of dilutive potential ordinary shares that must be included in the year-to-date period calculation is the weighted average number of the dilutive potential ordinary shares included in each interim dilutive earnings per share computation.
B. Dilutive potential ordinary shares (e.g., convertible securities, warrants, share options and contingently issuable shares) are deemed to have been converted, exercised or issued into ordinary shares at the end of the current reporting period.
C. Dilutive potential ordinary shares shall be determined independently for each period presented.
D. The number of ordinary shares shall be excluded from calculating the number of shares for diluted earnings per share
C. Dilutive potential ordinary shares shall be determined independently for each period presented.
This choice reflects the requirement under IAS 33, which stipulates that the calculation of the number of dilutive potential ordinary shares should be done separately for each reporting period, taking into account the specific conditions and potential impacts of dilutive instruments for that particular period. The other options either describe incorrect methods or misrepresent the principles for calculating diluted earnings per share.
