IAS 8

When should a company change its accounting policies?

• Never

• Every financial year

• if required by statute or a new/revised accounting standard

• if required by statue or a new/revised accounting standard or if the change gives more relevant and reliable information

Existing IAS and IFRS cover all possible accounting transactions / situations

• true

• false

When a new standard results in a change in accounting policy that change is normally accounted for in what way

• prospectively (going forward only)

• retrospectively (comparative figures restated)

• the company can choose

• by ignoring it

Under IAS 8, all errors are corrected in the financial statements

• true

• false

How are material errors, discovered in a subsequent accounting period, dealt with? eg a 2020 error discovered in 2021

• ignored

• corrected in the 2021 financial statements as part of the current year figures

• corrected in the 2021 financial statements by restating the 2020 figures to reflect correction of the error

• averaged over the 2 years

details of a material error should be included in the notes to the financial statements

• true

• false

Changes in accounting estimates is a form of error

• true

• false

How are changes in estimates dealt with?

• retrospectively (comparatives restated)

• prospectively (numbers changed going forward)

• by note disclosure only

• ignored

A company has a year end September 2023 and is due to finalise its financial statements in January 2024. In November 2023 it discovers a major fraud which impacts the September 2023 inventory balance. This is an example of what?

• non-adjusting event per IAS 10

• adjusting event per IAS 10

• error per IAS 8

• change in estimate per IAS 8

A company with a year end December 2022 finalised its financial statements in June 2023. In November 2023 it discovers a major fraud which impacts the December 2022 inventory figure. This is an example of what?

• non- adjusting event per IAS 10

• adjusting event per IAS 10

• error per IAS 8

• change in estimate per IAS 8