Errors in Retrospective Application of Changes in Accounting Estimates and Inconsistent Allowance for Impairment Loss
National Housing Authority · 2024
This summary was generated automatically from the source document and may contain errors. It is not an official interpretation and should not be relied upon as legal guidance. Review the original excerpt and source document to verify before citing or acting on it.
What Happened?
Category: Financial ReportingIssue: Accounting ErrorErrors in applying accounting estimates and impairment rules led to misstated bad debt provisions and surplus balances.
Why It Matters
Recommended Actions
- Adjust and/or refrain from using the Accumulated Surplus account to record the effect of changes in accounting estimates, pursuant to Paragraphs 37 to 41 of IPSAS 3
Original Audit Finding Excerpt
"Error in retrospective application of changes in accounting estimates and inconsistent application of existing accounting policy on Allowance for Impairment Loss resulted in the understatement of the Allowance for Impairment Loss, Provision for Impairment Loss, and Accumulated Surplus by P137.161 million, P561.965 million, and P424.804 million, respectively, for the identified Receivable accounts in arrears."