IAS 1 requires certain line items in the Statement of Financial Position. However, there may be circumstances in which a company will augment the presentation to help users understand the entity's financial position. Which of the following is true about management's considerations to present additional items?
A) Management will use the true and fair override instead of judgment.
B) Management should avoid considering adding additional liabilities to the balance sheet and instead choose to present assets.
C) Management should only consider the amount and timing of liabilities.
D) Management should always consider both the nature and liquidity of assets.

Question

Quizplus · Accepted Answer

Management should always consider both the nature and liquidity of assets when deciding to present additional items in the financial statements. This helps users better understand the entity's financial position by providing more detailed information on how assets can be converted into cash and how they are expected to be used in the business operations.

IAS 1 Requires Certain Line Items in the Statement of Financial