Inventories are measured at the lower of cost and net realisable value. Cost includes purchase costs, costs of conversion and other costs incurred in bringing inventories to their present location. First-in, first-out or weighted average can be used as the cost formula; last-in, first-out is not permitted under TFRS.
Source: TAS 2
Related terms
Net realisable valueThe estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.Inventory count observationThe auditor attending the entity's year-end physical count to verify the existence and condition of inventories.Accounting policiesThe specific principles, bases, conventions, rules and practices an entity applies in preparing its financial statements.Amortised costThe amount at which a financial asset or liability is measured at initial recognition, minus principal repayments, plus cumulative amortisation calculated using the effective interest method.AssociateAn entity over which the investor has significant influence but not control or joint control.BOBİ FRS (Turkish GAAP for SMEs)The financial reporting standard issued by the POA for large and medium-sized entities that are subject to independent audit but do not apply TFRS.
Last updated: October 22, 2026 · This definition is for general information only.