IFRS and US GAAP authorised CMUCPP maintains the constant purchasing power of constant real value non-monetary items (e.g. capital, all items in shareholders´ equity, provisions, salaries, wages, pensions, taxes, trade debtors/creditors, etc) in terms of a Daily CPI in entities that at least break even in real value during low and high inflation, hyperinflation and deflation - ceteris paribus. European Accounting Assoc: "Capital maintenance is a competing objective of financial reporting."
IAS 29, the IASB´s greatest failure to date, affected the Zimbabwe economy very
negatively during hyperinflation. It was implemented during various years in
Zimbabwe´s hyperinflationary economy with no positive effect. The failed IAS 29
had a very negative effect since it encourages and requires the implementation
of the Historical Cost Accounting model during hyperinflation, the most destructive
requirement in IFRS authorised by the very inefficient IASB.
Opinions on this blog expressed by me are my personal opinions.
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