Accounting Policies and Accounting Estimates-Proposed amendments to IAS 8 - (25-09-2017)
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In this Exposure Draft, the IASB proposes to amend IAS 8. With the aim to help entities distinguish accounting policies from accounting estimates. More specifically, the proposed amendments would clarify:
how accounting policies and accounting estimates relate to each other, by:
explaining that accounting estimates are used in applying accounting policies; and
making the definition of accounting policies clearer and more concise;
that selecting an estimation technique, or valuation technique, used when an item in the financial statements cannot be measured with precision, constitutes making an accounting estimate; and
that, in applying IAS 2 Inventories, selecting the first-in, first-out (FIFO) cost formula or the weighted average cost formula for interchangeable inventories constitutes selecting an accounting policy.
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