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IAS 8Workpapers (Step 4 of 5)

Workpaper template

Step 4 of 5

IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors — wording before IFRS 18Applicable today

Applies to annual periods beginning before January 1, 2027.

WorkpaperIAS 8 — Accounting Policies, Changes in Accounting Estimates and ErrorsL3 · L4

Impracticability memo

2 missions9 sections to document45 min
Prepared by
AI-assisted draft
Reviewed by
Not reviewed — human review required
Status
Published

Objective of the workpaper

Document the historical data available and the reasonable efforts made, assess against the three situations of the definition whether retrospective application or restatement is impracticable for a given period or for the cumulative effect, determine the earliest practicable period, estimate the amounts needed using only the information available at the time (no hindsight), compute the adjustment at that date and prepare the disclosure of the circumstances.

9 sections · 18 blocks · 2 calculations · 0 entries

  • IAS 8 §5
  • IAS 8 §23
  • IAS 8 §24
  • IAS 8 §25
  • IAS 8 §43
  • IAS 8 §44
  • IAS 8 §45
  • IAS 8 §51
  • IAS 8 §53
  • IAS 8
  • IAS 8 §49

Work this workpaper as a mission

Each case that uses this template opens in the mission workspace: data, analysis, calculation, entries, conclusion and review, with your progress saved.

2 instances from the cases: the calculations and entries below are run by the calculation engine.

File and entity
Historical data lost: impracticability, earliest practicable period and no use of hindsight
Case tasks documented here
  • Is restating 20X4 impracticable? From which date is the error corrected?
  • Estimate the value of the D moulds at 31 December 20X4 with the information of the time only.
  • Compute the adjustment at 1 January 20X5.
  • What must be disclosed about impracticability?
1

Inputs

Inputs

  • Subject: error or change in policy to be applied to prior periods

    TextRequired

    MOULDS_SCRAPPED_NOT_DERECOGNISED

  • Inventory of the historical data available, period by period

    TextRequired

    COUNT_AT_31_DECEMBER_20X4_ONLY

  • Steps taken to rebuild the data (reasonable efforts)

    TextRequired

    ARCHIVES_DESTROYED_INTERVIEWS_SCRAP_DEALERS

  • Information obtained after the date concerned (to be excluded if hindsight)

    Text

    LIQUIDATOR_LETTER_SEPTEMBER_20X5_EXCLUDED

  • Effects determinable at the earliest practicable date

    Table

    FAMILY_A · 92,000 | FAMILY_B · 61,000 | FAMILY_C · 33,000

  • Carrying amount of an item whose measurement at the date concerned must be estimated

    Number

    40,000

  • Scenarios known at the time (amount, probability in %)

    Table

    INTACT · 40,000 · 50 | DAMAGED · 16,000 · 30 | LOST · 0 · 20

    Teaching assumption: the estimation method (weighting of scenarios) is given by the case; IAS 8 only requires that only the information available at the time be used (para. 53).

2

Supporting evidence

Evidence

  • Evidence obtained and referenced (category, document reference)

    EvidenceRequired

3

Impracticability assessment

Analysis

IAS 8 §5IAS 8 §23IAS 8 §24IAS 8 §25IAS 8 §43IAS 8 §44IAS 8 §45

  • Points reviewed

    ChecklistRequired

    • Every reasonable effort has been made
    • Effects not determinable
    • Assumptions needed about management's intent at the time
    • Significant estimates without an objective distinction of the information of the time
    • Period-specific effects of a period presented not determinable
    • Cumulative effect at the beginning of the current period not determinable
    • Error: retrospective restatement, except to the extent impracticable
    • Earliest practicable period identified (may be the current period)
4

No use of hindsight

Analysis

IAS 8 §51IAS 8 §53

  • Points reviewed

    ChecklistRequired

    • Estimates based on the situation and the information of the time
    • Objective: reflect the circumstances that existed when the transaction occurred
    • Later information excluded
    • No hindsight assumption about management's intent
5

Adjustment at the earliest practicable date

Calculations

IAS 8 §24IAS 8 §44IAS 8 §53

  • Value estimated with the information of the time only

    Calculation

    24,800

    Scenarios known at the time (amount, probability in %)

  • Pre-tax adjustment at the earliest practicable date

    Calculation

    201,200

    Effects determinable at the earliest practicable date ; Carrying amount of an item whose measurement at the date concerned must be estimated ; − Value estimated with the information of the time only

    IFRS rule: adjustment of the opening balances of the earliest practicable period (para. 24 and 44); this adjustment accumulates the effect of all periods before that date, without a breakdown by period, which cannot be determined.

6

Impracticability judgement

Judgment

IAS 8 §5IAS 8 §24IAS 8 §25IAS 8 §44IAS 8 §45

  • Situation

    JudgmentRequired

    Period-specific effects impracticable for a period presented

    Restatement practicable for all periods / Period-specific effects impracticable for a period presented / Cumulative effect impracticable at the beginning of the current period

    Professional judgement: cost or difficulty are not enough; impracticability is assessed after every reasonable effort, against the three situations of the definition (para. 5).

  • Rationale: facts relied on, analysis, alternative rejected

    TextRequired

    SCRAPPING_DATES_UNDETERMINABLE_COUNT_AT_YEAR_END

  • Date of the adjustment

    ChoiceRequired

    Opening of the current period

    Opening of the earliest period presented / Opening of the current period / Prospectively from the earliest practicable date

7

Disclosures

Disclosure

IAS 8IAS 8 §49

  • Points reviewed

    ChecklistRequired

    • Circumstances that led to impracticability
    • How and from when the error has been corrected
    • Change in policy: impracticability disclosures
8

Conclusion

Conclusion

  • Impracticability conclusion, date and amount of the adjustment

    ConclusionRequired

9

Normative references

References

  • Normative references

    References

10

Checks and financial statement impact

  • Situation documentedPass
  • Adjustment date selectedPass
Assets
0
Liabilities
0
Profit or loss
0
OCI
0
Equity
0