Q4-3IFRS
Question
Bradshaw Company experienced a loss that was deemed to be both unusual in nature and infrequent in occurrence. How should Bradshaw report this item in accordance with IFRS?
Step-by-Step Solution
Verified Answer
Under IFRS, extraordinary items should be reported separately.
1Meaning of Extraordinary Items
In accounting, the term extraordinary items denote the non-recurring and abnormal gains and losses associated with a business entity. It also includes the revenues and expenses that are non-operating.
2Reporting of extraordinary items under IFRS
The IFRS does not disclose the unusual and infrequent events as extraordinary items. IFRS requires separate disclosure for extraordinary items. Such information can either be reported on the face of the income statement or in the notes section linked with the income statement of a business concern.
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