07-14-2006, 04:32 AM
<blockquote id="quote"><font size="1" face="Verdana, Tahoma, Arial" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by insaan</i>
<br />plz confirm this;
there is a difference in prospective application of a change in accounting estimate and a change in acounting policy
Prospective application of a change in acountingpolicy means;(para 8.5) applying the new accounting policy to transactions,other events and conditions occurring after the dateas at which the policy is changed; and
propective application of a change in accounting estimate mean Recognizing the effect of the change in the accounting estimate in the current and future periods affected by the change.
for example,lets consider date is 30 dec 2005 , onthis datethere is a change in acounting policy,we wud applythis change prospectively from 1 jan 2006 & ifthere is a change in accounting estimate,we wud applythis change prospectively from 1 jan 2005
M I rite?and iF i am rite it means this is the basisof prospective application of change in accounting policy from cost model to revalaution inIAS 16 and IAS 38?1nce again M I Rite?DO confirm plz
thx
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
yeah you are very much right, infact it was a very critical observation.
In case of IAS 16 and 38, IAS 8 doesnt consider it as a change in accounting policy for its own requirements, because back dates fair values are hard to assess. However change in accounting estimate relating to IAS 16 & 38 shall be accounted for in the same way as stated by you.
<br />plz confirm this;
there is a difference in prospective application of a change in accounting estimate and a change in acounting policy
Prospective application of a change in acountingpolicy means;(para 8.5) applying the new accounting policy to transactions,other events and conditions occurring after the dateas at which the policy is changed; and
propective application of a change in accounting estimate mean Recognizing the effect of the change in the accounting estimate in the current and future periods affected by the change.
for example,lets consider date is 30 dec 2005 , onthis datethere is a change in acounting policy,we wud applythis change prospectively from 1 jan 2006 & ifthere is a change in accounting estimate,we wud applythis change prospectively from 1 jan 2005
M I rite?and iF i am rite it means this is the basisof prospective application of change in accounting policy from cost model to revalaution inIAS 16 and IAS 38?1nce again M I Rite?DO confirm plz
thx
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
yeah you are very much right, infact it was a very critical observation.
In case of IAS 16 and 38, IAS 8 doesnt consider it as a change in accounting policy for its own requirements, because back dates fair values are hard to assess. However change in accounting estimate relating to IAS 16 & 38 shall be accounted for in the same way as stated by you.
