accounting policies and estimates

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May 25, 2019 at 8:31 pm #517343
reem1589
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Hello,
Could you please explain why the answer to the following question could not be C (correct answer is A).

Which of the following is a change of accounting policy under IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors?

A. Classifying commission earned as revenue in the statement of profit or loss, having previously classified it as other operating income.

B. Switching to purchasing plant using finance leases from a previous policy of purchasing plant for cash.

C. Changing the value of a subsidiary’s inventory in line with the group policy for inventory valuation when preparing the consolidated financial statements.

D. Revising the remaining useful life of a depreciable asset.
May 28, 2019 at 2:04 pm #517657
P2-D2
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Hi,

C is not a change in accounting policy, it is just adjusting the value of the inventory to be shown in the group accounts. The accounting policy for inventory valuation will remain the same in the individual accounts.

Thanks
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