Factors that contribute to depreciation of a Fixed asset are:
- Physical deterioration/Expected physical wear and tear.
- Obsolescence/Economic factors.
- Depletion (Natural resources such as mines)
- Legal limit/Time factor.
THIS SECTION provide you with all materials falling under corporate reporting subject (ACCA P2) AND THEIR RELATED PRACTICE QUESTIONS.
Over trading arises when company expands its sales revenue fairly rapidly without securing additional long term capital adequate fro its needs.
The … Read the rest
In a move to improve the capacity of government to provide the legislative bodies, citizens, media and other stakeholders with understandable, relevant, reliable, and comparable financial statements, the government of Rwanda has taken the path of adopting the International Public Sector Accounting Standards (IPSAS).
Discuss any four benefits that will be achieved by the … Read the rest
The International Public Sector Accounting Standards (IPSAS) are developed by the IPSAS Board (IPSASB), a non-UN entity. According to their publications, “The objective of the IPSASB is to serve the public interest by developing high-quality accounting standards and other publications for use by public sector entities around the world in the preparation of general purpose financial reports… Read the rest
All accounting information produced by businesses should have some key qualitative characteristics.
Relevance: accounting information is relevant if it has the ability to influence the economic decisions of users and is provided in time to influence those decisions. Information that is relevant has both predictive value and confirmatory values. Relevancy implies the … Read the rest
Due to the complexity of International Financial Reporting Standards (IFRSs), judgements used at the time of transition to IFRSs have often resulted in prior period adjustments and changes in estimates being disclosed in financial statements. The selection of accounting policies and estimation techniques are intended to aid comparability and consistency in financial statements.
However, IFRSs … Read the rest
If financial information is to be useful, it must be relevant and faithfully represent what it purport to represent. The usefulness of financial information is enhanced if it is comparable, verifiable, timely and understandable with the fundamental qualitative characteristics being relevance and faithful representation.
To be useful information must be relevant to the decision making needs of the user. The information … Read the rest