period, the circumstances that led to the existence of that condition and a description of how and from when the error has been corrected.

                                                      Financial statements of subsequent periods need not repeat these disclosures.

Impracticability in respect of retrospective application and

retrospective restatement

In some circumstances, it is impracticable to adjust comparative information for one or more prior periods to achieve comparability with the current period. For example, data may not have been collected in the prior period(s) in a way that allows either retrospective application of a new accounting policy (including, for the purpose of paragraphs 51-53, its prospective application to prior periods) or retrospective restatement to correct a prior period error, and it may be impracticable to recreate the information.

It is frequently necessary to make estimates in applying an accounting policy to elements of financial statements recognised or disclosed in respect of transactions, other events or conditions. Estimation is inherently subjective, and estimates may be developed after the reporting period. Developing estimates is potentially more difficult when retrospectively applying an accounting policy or making a retrospective restatement to correct a prior period error, because of the longer period of time that might have passed since the affected transaction, other event or condition occurred. However, the objective of estimates related to prior periods remains the same as for estimates made in the current period, namely, for the estimate to reflect the circumstances that existed when the transaction, other event or condition occurred.

Therefore, retrospectively applying a new accounting policy or correcting a prior

period error requires distinguishing information that

(a)        provides evidence of circumstances that existed on the date(s) as at

which the transaction, other event or condition occurred, and

(b)        would have been available when the financial statements for that prior

period were authorised for issue

from other information. For some types of estimates (eg a fair value

measurement that uses significant unobservable inputs), it is impracticable to distinguish these types of information. When retrospective application or retrospective restatement would require making a significant estimate for which it is impossible to distinguish these two types of information, it is impracticable to apply the new accounting policy or correct the prior period error retrospectively.

              Hindsight should not be used when applying a new accounting policy to, or

correcting amounts for, a prior period, either in making assumptions about what management's intentions would have been in a prior period or estimating the amounts recognised, measured or disclosed in a prior period. For example,

when an entity corrects a prior period error in calculating its liability for employees' accumulated sick leave in accordance with IAS 19 Employee Benefits, it

disregards information about an unusually severe influenza season during the next period that became available after the financial statements for the prior period were authorised for issue. The fact that significant estimates are frequently required when amending comparative information presented for prior periods does not prevent reliable adjustment or correction of the comparative information.

Effective date

An entity shall apply this Standard for annual periods beginning on or after 1 January 2005. Earlier application is encouraged. If an entity applies this Standard for a period beginning before 1 January 2005, it shall disclose that fact.



IFRS 13 Fair Value Measurement, issued in May 2011, amended paragraph 52. An entity shall apply that amendment when it applies IFRS 13.

IFRS 9 Financial Instruments, as amended in November 2013, amended paragraph 53 and deleted paragraphs 54A and 54B. An entity shall apply those amendments when it applies IFRS 9 as amended in November 2013.

Withdrawal of other pronouncements

              This Standard supersedes IAS 8 Net Profit or Loss for the Period, Fundamental Errors

and Changes in Accounting Policies, revised in 1993.

              This Standard supersedes the following Interpretations:

(a)       SIC-2 Consistency—Capitalisation of Borrowing Costs; and

(b)       SIC-18 Consistency—Alternative Methods


Amendments to other pronouncements

The amendments in this appendix shall be applied for annual periods beginning on or after 1 January 2005. If an entity applies this Standard for an earlier period, these amendments shall be applied for that earlier period.


The amendments contained in this appendix when this Standard was revised in 2003 have been incorporated into the relevant pronouncements published in this volume.

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