Financial Performance Ratios under the New Performance Reporting Requirements of IFRS 18

This diploma thesis examines the impact of the new requirements for the presentation of financial performance under IFRS 18 on selected financial ratios. The aim of the thesis is to assess how changes in the structure of the statement of profit or loss and the new definition of operating profit affect the calculation and interpretation of financial performance ratios. The theoretical part defines financial performance and selected financial ratios and subsequently focuses on the main changes introduced by IFRS 18 compared with IAS 1, particularly the new classification of income and expenses, mandatory subtotals, and management-defined performance measures. The practical part is based on an analysis of Mercedes-Benz Group AG and BP p.l.c. and the reclassification of their statements of profit or loss for 2024 and 2025 in accordance with IFRS 18 requirements. Based on the adjusted data, the impact of the reclassification on selected financial ratios is subsequently assessed. The results show that the extent of the impact of IFRS 18 depends primarily on the construction of the particular ratio. Ratios based on figures that are not affected by the reclassification remain unchanged, while operating performance ratios are affected by the new definition of operating profit. Changes in their values do not represent a change in the underlying economic performance of the company but may lead to a different assessment and interpretation of its operating performance.