CERTYNEX IFRS ACADEMY

Galvane's accountant recognised a provision of 210,000 for a buy-back programme for defective products, supported only by the minutes of the executive committee of 28 December approving the programme. No announcement has been made to customers or distributors. What is the error?

The amount of 210,000 should have been discounted.

The provision should have been presented as a trade payable.

The provision should have been doubled to cover the distributors.

No obligation exists at the reporting date: the decision was not communicated to those affected.