Operating profit
Operating profit is the IFRS 18 subtotal of income and expenses classified in the operating category. It reflects operating activities and excludes amounts classified in the investing, financing and income tax categories. Investment income classified in the investing category appears after operating profit; it is included in the next relevant subtotal.
Worked example
An entity with revenue of 1,000 and operating expenses including cost of sales of 800 has operating profit of 200.
Common mistake
Automatically equating operating profit with profit before interest and tax when investing-category items exist.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | F2 | Supporting | July 2027–August 2028 |
| ACCA | FA | Direct | September 2026–June 2027 |
| ACCA | FR | Direct | Official assessment-window verification pending |
| ACCA | K1 | Direct | July 2027–August 2028 |
| CIMA | F1 | Direct | Official assessment-window verification pending |
| CIMA | F2 | Direct | Official assessment-window verification pending |
| FIA | FFA | Direct | September 2026–June 2027 |