[subcream1]

From my understanding …..Unwinding a discount is the difference from the liability payable now as compare to the liability payable in the future after reporting date usually 12 months. This is accounting for the time value of money re present value of the obligation. The unwinding of the difference is the difference of the present value of the obligation at the end of the period and the present value of the obligation at the start of the period or the present value at the start of the period * mutiply by the discount rate.
A provision should be created i.e accounted by debiting finance cost and crediting liability of the obligation. Kindly inform me whether my understanding is correct

[Author]

Posts