Page 19 - PowerPoint Presentation

IAS 8

Accounting estimates

• The effect of a change in accounting estimate should be

included in the determination of net profit or loss

prospectively in

• the period of the change, if the change effects that period only;

or

• the period of the change and future periods, if the change affects

both (IAS 8.36).

• The useful life of any item of property, plant and equipment

and the depreciation method that is applied, should be revised

periodically.

• When it is apparent that an adjustment is required in either of
the two cases, the adjustment is treated as a change in estimate

in agreement with IAS 8.

• The depreciation charges for the current and future periods are

adjusted and no adjustment is made to the depreciation charges
of prior years.