You are an accountant in a construction company. It is nearly the end of the financial year and you are busy preparing the financial statements. While preparing the financial statements you figure out that a recently purchased piece of equipment has not been recorded and you cannot find the purchase documents. One of your colleagues suggested you include an approximate amount for the value of the equipment and prepare the financial statements based on that because it is a very important asset and should be included in the statement of financial position. Another colleague argued that you need to search more to find exact data for this record as you cannot enter data based on your assumption.

Using your accounting knowledge,state which approach you would take towards recording the equipment. Justify your answer using qualitative characteristics including relevance, faithful representation and materiality.