Valuation of Inventory according to re – denominated currency
28 August 2008
Dear All Recently our currency in Zimbabwe was re-denominated by 10 000 000 000 factor, prior to this we imported stocks and converted them at prevailing stipulated rates as at that period. After the re denomination we have stocks at 0 value. According to standards is it possible to re value stocks so that we will be able to reflect true inventory valuation and cost of sales.
I appreciate your assistance
As the economy in Zimbabwe has gone hyperinflationary it seem logical to follow IAS 29 Financial Reporting in hyperinflationary economies.
Inventory should be revalued to its present market value or inflation adjusted cost.