Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Prior to the audit of the financial statements, the members of the executive board of directors met to discuss the matter. There are several proposals

Prior to the audit of the financial statements, the members of the executive board of directors met to discuss the matter. There are several proposals that have been put forward to reduce the effect of such impairment loss on earnings per share as follows:

1. Increase the depreciation threshold for recognizable financial assets from 70% to 90%. These policy changes will be notified in the notes to the financial statements.

2. Recognize all impairment losses in other comprehensive income and open them in profit or loss distributable to shareholders.

3. Disregards an impairment loss and justifies in the notes to the accounts that the impairment loss of a financial asset is unrealized and temporary in nature.

Discuss the recognition of impairment losses on financial assets based on MFRS 9 Financial Assets and whether the recommendations of the above executive board members are contrary to those standards.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Risk Based Auditing

Authors: Phil Griffiths

1st Edition

0566086522, 9780566086526

More Books

Students also viewed these Accounting questions