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."
Capital Maintenance in Units of Constant Purchasing Power is the only accounting model specifically prescribed in IFRS
Capital Maintenance in Units of Constant Purchasing
Power is implied during hyperinflation in terms of IAS 29. Capital Maintenance
in Units of Constant Purchasing Power, i.e., restatement required in IAS 29, is
the only accounting model specifically prescribed in IFRS.
‘At the present time, it is not
the intention of the Board to prescribe a particular model other than in
exceptional circumstances, such as for those entities reporting in the currency
of a hyperinflationary economy.’
Framework (2010), Par. 4.65
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