Question $2$

"The financial statements of the Panasonic Manufacturing Malaysia Berhad $($Panasonic$)$ and

its subsidiaries are prepared in accordance with Malaysian Financial Reporting Standards

$("$MFRSs$"),$ International Financial Reporting Standards, and the requirements of the

Companies Act $2016$ in Malaysia, using the historical cost convention, modified to include

other bases of measurement as disclosed in other sections of the significant accounting

policies."

Based on the above statement, you are required to answer the following questions.

a$.$ Evaluate the reliability of financial statements prepared by Panasonic using the historical

cost convention. Evaluate using TWO $(2)$ points with relevant example.

$(12$ Marks$)$

b$.$ Determine ONE $(1)$ specific instance in which historical costs may not accurately reflect

the current value or economic reality of specific assets and liabilities.

$(4$ Marks$)$

c$.$ Based on your answer in part $($b$),$ how can users of Panasonic $\text{'}$s financial statements

overcome this constraint?

$(4$ Marks$)$

$($Total: $20$ Marks$)$