Material errors are corrected retrospectively: comparative amounts are restated and the opening equity of the earliest period is adjusted. The nature and effect of the error are disclosed in the notes.
Source: TMS 8
Related terms
Accounting policiesThe specific principles, bases, conventions, rules and practices an entity applies in preparing its financial statements.Accounting estimatesThe determination by management judgement of amounts that cannot be measured precisely, such as provisions, useful lives, expected credit losses and fair values.Statement of changes in equityThe statement showing the changes in each component of equity during the period.Accrual basis of accountingThe principle of recording transactions as income, expenses, assets and liabilities in the period in which they occur, rather than when cash is received or paid.Allowance for doubtful receivablesAn allowance made for receivables whose collection has become doubtful, recognising the expected loss as an expense.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.
Last updated: October 31, 2026 · This definition is for general information only.