CERTYNEX IFRS ACADEMY

Nordelia distributes identical spare parts, intended for the same use, from two warehouses: one in Lyon, the other in its Seville branch. The Lyon accounting department applies FIFO; the Seville one applies weighted average cost, considered more advantageous under local tax rules. What conclusion should be drawn for Nordelia's financial statements?

A single formula must be used for these parts, wherever they are located.

Both formulas may coexist, since the inventories are located in two different countries subject to different rules.

Nordelia must abandon both formulas and measure all parts by specific identification to remove the conflict.

Both formulas are acceptable provided the notes state the formula used by each warehouse.