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IAS 2 has changed how companies account for inventories on their financial statements.

As the largest or second-largest item on the balance sheet, and a significant item on the income
statement (cost of goods sold), accounting for inventory is a high priority.

A primary issue in accounting for inventories is the amount of cost to be recognized as an asset
and carried forward until the related revenues are recognized. Guidance on the determination
of cost and its subsequent recognition as an expense, including any write-down to net
realizable value as on the cost formulas that are used to assign costs to inventories are
provided.

IAS 2 requires the accountant to measure the fair value of inventory by choosing among several
alternative methods. But just exactly how do you do it? This presentation will provide you with
easy-to-follow guidelines that will ensure that you are able to comply with IAS 2.

Course Key Concept:  IFRS, IAS 2, Fair value, Asset revaluation, Revenue recognition

Learning Objectives

  • Discover concepts and rules for inventory under IAS 2.
  • Explore inventory costing methods under IAS 2.
  • Identify the accounting treatment of ownership of goods.
  • Recognize how IFRS provides accounting requirements for fair value of inventory under IAS 2.
  • Explore how IAS 2 handles net realizable value.
  • Explore other alternative valuation methods under IAS 2.
  • Discover the disclosure requirements of IAS 2.
  • Identify the financial statement presentation required by IAS 2.
Last updated/reviewed: April 8, 2020

1 Review (10 ratings)Reviews

3
Anonymous Author
The audio content of this course was essentially a reading of the content on the slide. I would have been improved by providing examples or other illustrations to demonstrate and tie the accounting concepts to real life situations.

Prerequisites

Course Complexity: Intermediate

No advanced preparation or prerequisites are required for this course.

Education Provider Information

Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact:
For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Course Syllabus
Introduction And Overview
  11:38Introduction to IFRS for Inventories
  1:55Objective and Application
  7:38Definitions
  11:45Cost of Inventory
  14:15Measurement
  3:02Other Costs
  3:21Service Provider Costs
  4:38Techniques for Cost Measurement
  5:36Cost Formulas
  11:31Net Realizable Value
  1:49Recognition As an Expense
  5:00Disclosures
Continuous Play
  1:22:08IFRS for Inventories
Supporting Material
  PDFSlides: IAS 2: IFRS for Inventories
  PDFIAS 2: IFRS for Inventories Glossary/Index
Review And Test
  quizREVIEW QUESTIONS
 examFINAL EXAM