I know it’s a probably stupid question, but it keeps popping up, so I guess it’s important to somebody.
For example, XYZ uses electricity in its retail outlets.
On 31.12.Y1, it estimates the expense to be 25,000 and records this amount as year 1 “electricity expense”
On 15.1.Y2, it receives a formal invoice from the supplier.
As per this invoice, it is able to determine that the actual Y1 expense was 28,000.
Question: assuming its fiscal year-end is 31.12, what would be the proper procedure for dealing with this accrued liability as per IFRS?
Now, lets assume that XYZ is a subsidiary of XYZ-International and is required, by its parent, to submit its financial statements (which the parent then consolidates) to the parent by the parent’s midnight on 3.1.Y2.
Additional question: would / could this have any influence on XYZ’s procedure as per IFRS?
Now, lets assume that XYZ is required by local legislation to prepare a “National GAAP” financial report (“National GAAP” prescribes the calendar year as a fiscal year).
Final question: what impact would this have on XYZ’s IFRS report (assuming a 20% tax rate).