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Hi,
Can you explain the difference in the above for me and what should be included in both. Keep getting confused when completing q1 in P2 paper.
Thanks,
Ed
R/E is retained earnings and includes just the profits from previous years and from current year.
Reserves is a much wider notion, which means everything that goes to equity, other than the share capital, ie R/E, revaluation reserves, fx exchange profit/loss, other components of equity etc.
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