030-Changes In Accounting

Question 1

IFRS IAS8

ASPE 1506

Answer 1

Retrospective change
1 Voluntary change in accounting policy
Change in inventory costing method
IAS 8- present more reliable and relevant
ASPE1506-no need for Subsidiaries , Jointly
Controlled,development cost, DB,
Income taxes, convertible debt
2. Correction of errors
Math or transposition errors
IAS 8- if impracticable,only open balances
ASPE1506-No allowance made for impracticably
Prospectively-change is estimates
Consistent with transitional provisions-the standard
Requires the policy change.
IFRS16 replaces IAS17

Question 2

Required disclosure

Answer 2

Voluntary policy change
1 nature and reason
2 current and prior impacted, that
Amount
3 retrospective not practical, an explanation
Standard policy change
1 title or interpretation
2 nature
3 description of transitional provisions
4 if retrospective, same with voluntary change
Estimates
1 nature and amount affect current or future periods
2 not possible estimate future, disclosure
Error
1 Description
2 error amount for prior months
3 if retrospected, not positive, a description of how error was corrected

Question 3

Accounting estimate

Answer 3

1 allowance for doubtful accounts
2 estimated useful life and salvage value of PPE
3 warranty provisions
4 lawsuit provisions
5 decommissioning provisions (asset retirement)
6 accrued expense

Question 4

Accounting policy

Answer 4

1 FIFO vs average cost for inventory costs
2 Declining balance vs straight-line balance
3 cost method vs revaluation method of PPE
4 IFRS vs ASPE(private entities)

Question 5

Change in Accounting Policy

ASPE 1506

Answer 5

1 Subsidiaries
Consolidated- equity method or
ASPE 3856 financial instruments
2 Jointly controlled enterprises - cost or equity
Method
3 Development costs- capitalization or expense
Intangible assets during the development
Phase
4 Defined benefit obligation -appropriate funding
Valuation
5 Income taxes - taxes payable or future income
Taxes method
6 Convertible debts - initially measuring the equity
Component of a financial instrument that
Contains both a liability and an equity
Component at zero