When it is difficult to distinguish between a change of estimate and a change in accounting policy, then an entity should (a) Treat the entire change as a change in estimate with appropriate disclosure. (b) Apportion, on a reasonable basis, the relative amounts of change in estimate and the change in accounting policy and treat each one accordingly. (c) Treat the entire change as a change in accounting policy. (d) Since this change is a mixture of two types of changes, it is best if it i

When it is difficult to distinguish between a change of estimate and a change in accounting policy, then an entity should (a) Treat the entire change as a change in estimate with appropriate disclosure. (b) Apportion, on a reasonable basis, the relative amounts of change in estimate and the change in accounting policy and treat each one accordingly. (c) Treat the entire change as a change in accounting policy. (d) Since this change is a mixture of two types of changes, it is best if it i

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter7: Planning The Audit: Identifying, Assessing, And Responding To The Risk Of Material Misstatement

Section: Chapter Questions

Problem 3CYBK

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Similar questions

Which of the following is not one of the approaches for reporting accounting changes? The change approach. O The retrospective approach. The prospective approach. O All of these answer choices are approaches for reporting accounting changes.
Under IFRS, changes in accounting policies are a. permitted if the change will result in a more reliable and more relevant presentation of the financial statements. b. permitted if the entity encounters new transactions, events, or conditions that are substantively different from existing or previous transactions. c. required on material transactions, if the entity had previously accounted for similar, though immaterial, transactions under an unacceptable accounting method. d. required if an alternate accounting policy gives rise to a material change in assets, liabilities, or the current- year net income.
The change in accounting estimate should be treated currently and prospectively. True or false
When it is difficult to distinguish a change in accounting policy from achange in an accounting estimate, the change is treated as A. Change in accounting estimate with appropriate disclosureB. Change in accounting policyC. Correction of an errorD. Initial adoption of an accounting policy
Which of the following would be considered a change that affects consistency? * Change in accounting estimate. O Change in reporting entity. Change in classification and reclassification.
Choose the letter that correponds to the answer.
Discuss how a change in accounting policy is handled when it is impracticable to determine previous amounts.
Why is retrospective treatment of changes in accounting estimatedprohibited? A. Changes in estimate are normally corrections and adjustments which are the natural result of the accounting process B. The retrospective treatment for any type of presentation is not allowed C. Retrospective treatment of changes in accounting estimate is required by IFRS D. The IFRS is silent on the issue
Using IFRS, a change in accounting policy for which a standard does not include specific transitional provisions should be applied a. prospectively. b. practicably. c. in accordance with management’s judgment. d. retrospectively.
Discuss how a change in accounting policy is handled when it is impractical to ascertain earlier values due to unforeseen circumstances.
Which of the following is true regarding whether IFRS specifically addresses the accounting and reporting for effects of changes in accounting policies? Direct Effects Indirect Effects a. Yes Yes b. No No c. No Yes d. Yes No
Identify the circumstances under which it may be appropriate to change accounting policy in accordance with the guidance given in IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors.