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Ask the Tutor ACCA SBR

IAS 8

ZzorrizSupporter4y ago
Hi Sir, I would like to ask if the company change the purpose of use of an item or change its intention for using the item, will it consider a change of accounting policy and applied retrospectively? for example, the item is treated as COS or inventory at that time but recognised as an asset after 2 years? Will the company need to restate the depreciation charge for the last 2 years? Thank you.
stephenwidbergstephenwidbergTutor4y ago#1
Not change in accounting policy. This is a change in use. Transfer from inventory to PPE at CA. Then apply IAS 16 / IAS 36 going forward.
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