[Attributes of CIPPA - Part 1 of 3: Monetary items inflation-adjusted daily]
[Attributes of CIPPA - Part 2 of 3: Variable items updated daily]
Constant items measured in units of constant purchasing power daily
Constant items are always and
everywhere measured in units of constant purchasing power in terms of a DCPI or
monetized daily indexed unit of account during low and high inflation and
deflation and in terms of a daily hard currency parallel rate of daily index
rate during hyperinflation under CIPPA. This would eliminate the entire cost of
the stable measuring unit assumption (mistakenly thought to be the same as the
cost of inflation) – currently hundreds of billions of US Dollars per annum –
from the constant item economy only in the unlikely case of complete co-ordination
right from the start of changing over to financial capital maintenance in units
of constant purchasing power in terms of a daily rate.
Valuation and accounting of
constant items within an entity – with no third parties involved – are always
and everywhere done in units of constant purchasing power in terms of a daily
rate under CIPPA. This includes all items in shareholders´ equity, provisions, pensions,
salaries, wages, rentals, all other items in the income statement, accounts
payable, accounts receivable, all other non- monetary payables, all other
non–monetary receivables, etc.
Nicolaas Smith
Copyright (c) 2005-2012 Nicolaas J Smith. All rights reserved. No reproduction without permission.
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