Difference between Accounting Treatment and Implication on Financial Statements

This topic has 3 replies, 2 voices, and was last updated 3 years ago by Stephen Widberg.

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November 6, 2022 at 7:58 am #670745
daniyal45
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Actually, I have Chartered Accountancy question of IAS 16 and 36. In which we have to calculate Recoverable Amount and compare with Carrying Amount. And other IAS 16 adjustments. I have changed its requirement from calculating Impairment Loss to discuss above matters implications in Financial Statements?
So, what does this implications means. And if examiner ask discussion about accounting treatment of transaction. What does it means?
November 6, 2022 at 9:18 am #670760
Stephen Widberg
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Accounting treatment means exactly the same as impact on financial statements.
November 6, 2022 at 11:54 am #670772
daniyal45
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so, it means I have to explain how impairment can be recorded in certain cases.
November 7, 2022 at 7:39 am #670818
Stephen Widberg
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Yes. Many people make the mistake of thinking that they can pass by writing journals. This is totally wrong. It is your explanations that count.
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