In the case of classifying a liability as current or non-current,what approach does AASB 101 require if there is no clearly identifiable operating cycle?
A) The most common length of operating cycle for other entities in a comparable industry must be used.
B) The operating cycle of the event that gave rise to the creation of the liability must be used as the basis for determining the liability's operating cycle.
C) The 12-month period from the reporting date must be used.
D) The average operating cycle length over all operations of the entity must be used.

Question

Quizplus · Accepted Answer

AASB 101 requires that if there is no clearly identifiable operating cycle, the 12-month period from the reporting date must be used as the basis for classifying a liability as current or non-current. This approach assumes that any liability not expected to be settled within the 12-month period should be classified as non-current.

In the Case of Classifying a Liability as Current or Non-Current,what