During the year ended 31 December 2019 the directors of Nami plc decided to change

the company's accounting policy in respect of consumable stores, such as dyes and

threads used in the manufacturing process. In the year ended 31 December 2018, and all

years prior to that, Nami plc's stated accounting policy was to write off the costs of such

consumable stores as incurred. The directors now wish to recognise consumable stores as

inventory, on the grounds that this better matches purchases made to sales generated. As a

result, the accountant included closing inventory of consumable stores of $22,600 in the

draft financial statements for the year ended 31 December 2019, but made no other

adjustments. It has been established that the equivalent figure at 31 December 2018 was

$31,200, but it has not been possible to arrive at figures prior to that date.

Explain the required IFRS financial reporting treatment for the

above in the financial statements of each company. Submit all relevant

calculations and set out the required adjustments in the form of journal entries.