Financial Accounting and Reporting | Discussion

FINANCIAL ACCOUNTING
AND REPORTING

INTRODUCTION
Every entity has to follow different rules and accounting laws to form their annual report. The annual report
contains the balance sheet of that entity for the specific year and the values of the assets and liabilities revalued
and impairment. The assets and liabilities revalued, and the assets are impairment. The difference between
liabilities, contingent liabilities and provisions are discussed below in detail. The difference between revaluation
of assets & liabilities and impairment of assets is also discussed .

DISCUSSION
• Difference between revaluation and impairment of assets
Here is a minimal difference among revaluation and impairment of assets. But both of them start with the evaluation of liabilities and assets
to identify their fair value of assets and liabilities. Then the next step involves taking required action for updating accounting books
(compare the difference between similar terms 2020). However, the major difference of both of them is that revaluation can be done on
both sides that is the value of assets can increase to the market value (moved upwards) or the value of assets can decrease (moved
downwards) (Cleartax.In 2020). According to AASB 136, the impairment of the assets can be done only from one side that is either the
calculation can be done for upward movement or the downward movement (AASB.Gov.Au 2020).