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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › CH 2 depreciation change.
Dear Chris,
How are you?
I hope you are doing well,
It’s mentioned in Kaplan textbook page#29 the following.
A change from one method of providing depreciation to another.
1-doesn’t constitute a change of Accounting policy.
2-is a change in accounting estimates.
Could you explain what is the difference between the change in depreciation, accounting policy and change in accounting estimates?
Thanks in advance.
Hi,
It is not a change in accounting policy as the policy is to depreciate, which is how we are measuring the asset. All we are doing when changing from straight line to reducing balance or vice versa is to change the estimate of the depreciation.
Hope that helps clear it up.
Thanks