Forums
Back
Depreciation method
Accountancy
Whether depreciation methods are accounting policies? Change in depreciation methods are treated as change in policy or estimate? Video Details ------------- P1 - Accounting Standards - CA Inter AS 1 #6. Changes in Accounting policies
Answers (2)
Under AS 1, the selection of a specific depreciation method (like Straight Line Method or Written Down Value Method) is considered an accounting policy. Change in depreciation method is a change in accounting estimate. The depreciation method is seen as a reflection of the expected pattern of consumption of future economic benefits. If that pattern changes, the estimate changes.
Your Reply