What is the assumptions characterizes the IFRS ?
these assumptions are explained detail:
- Going concern: The assumption that a business entity will be in operation for the foreseeable future.
- Accrual basis: The assumption that the financial effects of transactions and events are recognized as they occur, and not when cash is received or paid.
- Stable measuring unit assumption: The assumption that financial capital is measured in nominal monetary units. This is the historical cost accounting in which assets and liabilities are recorded at their values when first acquired and not generally restated for changes in values.
- Units of constant purchasing power: The assumption that the stable measuring unit assumption can be rejected in certain situations: Only constant real value non-monetary items are adjusted for inflation during low inflation or deflation. During hyperinflation however, all non-monetary items are adjusted as required under Constant Purchasing Power Accounting.
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