Changes in accounting estimates require disclosure of their effects, if material, on current year net income and EPS but do not require restatement of prior years' financial statements.

Question

Quizplus · Accepted Answer

Changes in accounting estimates are applied prospectively and do not require restatement of prior years' financial statements. However, the effects of these changes on the current year's financial statements, including net income and EPS, must be disclosed if they are material.

Changes in Accounting Estimates Require Disclosure of Their Effects, If