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Change in company policy due to which estimates changed whether going to be applied retrospectively or prospectively?

We booked the staff ticket provision every year  . This year we revised the estimate from3, to1, AED . what will the accounting treatment?. 

Accounting Accountancy
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Question added by Muhammad Maaz , Finance Manager , Byrne Technical Services
Date Posted: 2017/01/25
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Waseem Khan ACCA Member
by Waseem Khan ACCA Member , Accounts Manager , Medecins Sans Frontiers-Holland

AS per IAS 8,Changes in Accounting Policies and Estimates,Change in Accounting estimates is dealt prospectively.

As per your question,your company creates provision for staff ticket which is based upon estimate and IAS 8 requires to deal a change in estimate PROSPECTIVELY.

Adjust the new provision as proposed and no need to adjust opening balances.

Sethumadhavan krishnan
by Sethumadhavan krishnan , Personnel Affairs Supervisor , Saudi Catering & Contracting

Change of strategy time to time is required to cope with changing mentality of customers.

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