Re: [OPE] replacement cost and historical cost (again)

From: Philip Dunn <>
Date: Sun Sep 06 2009 - 02:44:28 EDT

On Fri, 2009-09-04 at 10:33 +0900, 이채언 wrote:
> As to Philip Dunn's argument;
> Past accountings cannot be adjusted in the future, by definition, and so the moral depreciation could not be retrospective, I think.
> In the given example, the fourth depreciation would be 40% (not 20%) inclusive of the moral depreciation of 20%. The fifth year depreciation is executed in advance. If a thing is depreciated in ADVANCE, we call it morally depreciated.
> Yours
> Chai-On

Hi Chai-On

"FRS3 ...
FRS3 states that a prior period adjustment is required to correct a
fundamental error or change in accounting policy. A fundamental error is
classified as an error which is so significant that the truth and
fairness of the financial statements is not achieved."

Depreciating by 40% in the 4th year would not be "true and fair" and
does not maintain the principal of depreciation in proportion to

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Received on Sun Sep 6 02:46:51 2009

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