IAS29_06 - IAS 29 International Accounting Standard 29...

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IAS 29 © IASCF 1265 International Accounting Standard 29 Financial Reporting in Hyperinflationary Economies This version includes amendments resulting from new and amended IFRSs issued up to 31 December 2005. The following Interpretation relates to IAS 29: •I F R I C 7 Applying the Restatement Approach under IAS 29 Financial Reporting in Hyperinflationary Economies
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IAS 29 1266 © IASCF C ONTENTS paragraphs INTERNATIONAL ACCOUNTING STANDARD 29 FINANCIAL REPORTING IN HYPERINFLATIONARY ECONOMIES SCOPE 1–4 THE RESTATEMENT OF FINANCIAL STATEMENTS 5–37 Historical cost financial statements 11–28 Balance sheet 11–25 Income statement 26 Gain or loss on net monetary position 27–28 Current cost financial statements 29–31 Balance sheet 29 Income statement 30 Gain or loss on net monetary position 31 Taxes 32 Cash flow statement 33 Corresponding figures 34 Consolidated financial statements 35–36 Selection and use of the general price index 37 ECONOMIES CEASING TO BE HYPERINFLATIONARY 38 DISCLOSURES 39–40 EFFECTIVE DATE 41
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IAS 29 © IASCF 1267 International Accounting Standard 29 Financial Reporting in Hyperinflationary Economies (IAS 29) is set out in paragraphs 1–41. All the paragraphs have equal authority but retain the IASC format of the Standard when it was adopted by the IASB. IAS 29 should be read in the context of the Preface to International Financial Reporting Standards and the Framework for the Preparation and Presentation of Financial Statements . IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors provides a basis for selecting and applying accounting policies in the absence of explicit guidance.
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IAS 29 1268 © IASCF International Accounting Standard 29 Financial Reporting in Hyperinflationary Economies Scope 1 This Standard shall be applied to the financial statements, including the consolidated financial statements, of any entity whose functional currency is the currency of a hyperinflationary economy. 2 In a hyperinflationary economy, reporting of operating results and financial position in the local currency without restatement is not useful. Money loses purchasing power at such a rate that comparison of amounts from transactions and other events that have occurred at different times, even within the same accounting period, is misleading. 3 This Standard does not establish an absolute rate at which hyperinflation is deemed to arise. It is a matter of judgement when restatement of financial statements in accordance with this Standard becomes necessary. Hyperinflation is indicated by characteristics of the economic environment of a country which include, but are not limited to, the following: (a) the general population prefers to keep its wealth in non-monetary assets or in a relatively stable foreign currency. Amounts of local currency held are immediately invested to maintain purchasing power; (b) the general population regards monetary amounts not in terms of the local currency but in terms of a relatively stable foreign currency. Prices may be quoted in that currency; (c)
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This note was uploaded on 06/12/2011 for the course ECON 801 taught by Professor Brend during the Summer '11 term at Abu Dhabi University.

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IAS29_06 - IAS 29 International Accounting Standard 29...

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