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My company sells goods in Brazil and recently, the Supreme Court equivalent here judged that a specific tax basis was not constitutional, thus changing the VAT applied and generating some gains from prior periods. Should I report those gains in Retained Earnings / Prior Periods or in the current year P&L? Thanks
in General IFRS Discussion by

1 Answer

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Maybe you could simply offset it from the current year liability as it does not meet the IAS 8 definition of a prior year error as there was no information in the prior year concerning the constitutional court ruling.. it is a current year movement.. unless the law was passed in the prior year.  If so, and the amount is material, then you may have to restate.
by Level 1 Member (1.3k points)