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Changes in inventory valuation policy

davidj515 · 2010-12-13 13:13:24

Hi there, I need some help with a financial accounting assignment that I'm doing right now involving consolidation of group accounts. The issue I'm having is with one of the adjustments that I have to make. Basically, the parent has a different inventory valuation policy to the subsidiary. If the subsidiary had adopted the…

13-12-2010 1:13pm

#1

davidj515

Closed Accounts Posts: 3 ✭

Join Date: December 2010

Posts: 1

Hi there,

I need some help with a financial accounting assignment that I'm doing right now involving consolidation of group accounts.

The issue I'm having is with one of the adjustments that I have to make. Basically, the parent has a different inventory valuation policy to the subsidiary. If the subsidiary had adopted the same policy as the parent at the acquisition date, the inventory of the subsidiary would have been valued at €20,000 less. However, it didn't adopt the same policy and now the required change to closing inventory to ensure uniform accounting policies is €30,000 less.

How should I adjustment for this in terms of my goodwill calculation under IFRS?

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