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Lassy has a year end of 31 December 2016. On 15th December 2016 the directors publicly announced their decision to close an operating unit
Lassy has a year end of 31 December 2016. On 15th December 2016 the directors publicly announced their decision to close an operating unit and make a number of employees redundant. Some of the employees currently working in the unit will be transferred to other operating units within Beta Co. The estimated costs of the closure are as follows; Redundancy costs: 800$ Lease termination costs: 200$ Relocation of continuing employees to new locations: 400$ Retraining of continuing employees: 300$ Future operating losses: 2,000$ What is the amount of provision that should be recognized under IAS 27 Provisions, Contingent Liabilities and Contingent Assets. Explain why which item should be expensed off.
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