IAS 8 - Accounting policies, changes in accounting estimates and Errors

Question 1

Accounting policies

Answer 1

select policy based on accounting standard
Entities must be consistent with choice of policies

changes - changes can made under the following circumstances
1. New standard
2. Directors are opinion it is more reliable/relevant

Changes only occur if there is a change in
1. Recognition
2. Presentation
3. Measurement basis
of financial statements

Accounting policies are applied retrospectively. prior period adjustments are put through open retained earnings.

Question 2

Accounting estimates

Answer 2

An adjustment because of reassessing e.g. revision of useful life

Changes are made prospectively

Question 3

Prior year period Errors

Answer 3

These are prior period omissions and misstatements for in the F.S from one or more prior periods.