Prior years' financial statements are restated under the:
A)Current approach.
B)Prospective approach.
C)Retrospective approach.
D)None of the above is correct.

Question

Quizplus · Accepted Answer

The retrospective approach involves restating prior years' financial statements as if the new accounting policy had always been applied. This approach provides a more accurate picture of the company's financial performance and ensures consistency in financial reporting. Thus, it is the best choice for restating prior years' financial statements.

Prior Years' Financial Statements Are Restated Under The