IAS 8Chapter 6Lesson 2
Correcting a prior period error: retrospective restatement and its disclosure
Step 1 of 9Learning objectives
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A material prior period error is corrected retrospectively in the first set of financial statements authorised for issue after its discovery: the comparatives of the period in which it occurred are restated, or the opening balances of the earliest period presented if it is older. The correction does not go through profit or loss of the period of discovery. The notes describe the error and the amounts corrected.
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Learning objectives
- Calculate the correction in the comparatives and opening balances, including the tax effect.
- Record the correction in opening equity, without going through profit or loss of the period of discovery.
- Analyse the impact of a restatement on the financial statements and draft the required disclosure.