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Notes to the Financial Statements (Extract)
VIGILANT INC.
For the Year Ended December 31, 20X9
Note XX: The company omitted to record an amortization charge in the amount of $30,000 in 20X8. The financial statements for 20X8 have been restated
to correct this error.
Explanation
According to the IAS 8, the amount of correction of an error that relates to prior periods should be reported by adjusting the opening balance of retained
earnings. Comparative information should be restated unless it is “impracticable” to do so. The steps in preparing the revised financial statements and
related disclosures are
1. As presented in the Statement of Changes in Equity (retained earnings columns only), the opening retained earnings were adjusted by $24,000,
which represented the amount of error, $30,000, net of income tax effect of $6,000.
2. The comparative amounts in the Statement of Comprehensive Income were restated as
2. Accounting policies
a. Statement of compliance
General and Administrative and Selling and Distribution expenses, including depreciation, before correction $120,000
Amount of correction 30,000
As restated $150,000
Income taxes before correction $ 45,000
Amount of correction (6,000)
As restated $ 39,000
EXTRACTS FROM PUBLISHED FINANCIAL STATEMENTS
J. SAINSBURY PLC Financial Statements to March 21, 2009
The Group’s financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as adopted by the
European Union and International Financial Reporting Interpretations Committee (“IFRICs”) interpretations and with those parts of the Companies Act
1985 applicable to companies reporting under IFRS. The Company’s financial statements have been prepared on the same basis and as permitted by
Section 230(3) of the Companies Act 1985; no income statement is presented for the Company.
b. Basis of preparation
The financial statements are presented in sterling, rounded to the nearest million (£m) unless otherwise stated. They have been prepared under the
historical cost convention, except for derivative financial instruments, investment properties and available-for-sale financial assets that have been
measured at fair value.
The preparation of financial statements in conformity with IFRS requires the use of judgments, estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the
circumstances, the results of which form the basis of making the judgments about carrying values of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from these estimates. The areas involving a higher degree of judgment or complexity, or areas where
assumptions and estimates are significant to the financial statements are disclosed in note 2c.
New Standards, interpretation and amendments to published standards
Effective for the Group in these financial statements:
• IFRIC 12, Service Concession Arrangements
The above interpretation to published standards has had no material impact on the results or the financial position of the Group for the 52 weeks to