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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Ecoma b1. Provision for roof
Can it be argued that provision can be made for the roof since their business practice is to be sustainable, so they created a constructive obligation for themselves as the new roof offsets the company’s CO2 emissions?
Interesting. 🙂
I think the answer remains as NO (for the present) – reflects future intention rather than present obligation
Only recognise liability once roof has been done (or at least until they pay for it)
Thank you for the response. If it is a well argued point will it still score marks even if the classification is wrong though?
Most of the marks!
But IAS 37 was written to stop companies ‘providing’ for future asset expenditure. So it’s a sensitive point. 🙂
🙂