Accounting policies and changes in accounting estimates

Abstract

IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors, replaces IAS 8, Net Profit or Loss for the Period, Fundamental Errors and Changes in Accounting Policies (revised in 1993) and should be applied for annual periods beginning on or after January 1, 2005. The Standard removes the allowed alternative to retrospective application of voluntary changes in accounting policies and retrospective restatement to correct prior period errors and eliminates the concept of a fundamental error. The Standard also defines material omissions or misstatements and describes how to apply the concept of materiality when applying accounting policies and correcting errors.