8. Other standards Flashcards
What is IAS 8?
Accounting policies, estimates and errors
What are the only two reasons you can change an accounting policy?
- It is required by an IFRS standard
- Results in the financial statements providing more reliable and relevant information
What are the three types of accounting policy change?
- Recognition
- Presentation
- Measurement
What are the three things you change when you have changed the accounting policy?
- Apply change retrospectively
- Change comparative information
- If the change to opening retained earnings cannot be reasonably determined then adjust prospectivly
What is IFRS 13?
Fair value measurement
What are the three levels that IFRS 13 establishes for valuation techniques?
Level 1 - Observable inputs in active markets
Level 2 - Similar items (not identical)
Level 3 - Unobservable inputs
How is inventory valued?
Lower of cost and NRV
What is IAS 41?
Agriculture
Give three examples of biological assets.
Sheep
Trees in a plantation
Dairy cattle
Give three examples of Agricultural produce at the point of harvest
Wool
Felled trees
Milk
Give three examples of Products resulting from processing after harvest (Outside scope of IAS 41)
Yarn/carpet
Logs/Lumber
Cheese
What is a biological asset?
A living animal or plant
When should a biological asset be recognised?
- It is probable that economic benefit will flow from the entity
- The costs/FV can be reliably measured
- The entity controls the asset
How do we initially measure a biological asset?
- Fair value less any estimated ‘point of sale’ costs
- If there is no fair value, then the cost model should be used.
How do we subsequently measure a biological asset?
Revalue to fair value less point of sale costs at year-end,
taking any gain or loss to the statement of profit or loss.
