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ARTÍCULO
TITULO

Accounting estimates in financial statements and their disclosure by some South African construction companies

Elsje Raubenheimer    

Resumen

AbstractAccounting estimates form part of the preparation of financial statements and should not affect faithful representation. The use of accounting estimates does not yield exact amounts, but, rather, amounts based on assumptions. The frequency of use of accounting estimates in financial statements depends on the measurement criteria prescribed by International Financial Reporting Standards (IFRSs). For example, in the absence of prices in an active market, and if measurement is at fair value, the fair value is based on assumptions. Disclosure of the assumptions on which accounting estimates are based enables the users of financial statements to judge if amounts are faithfully represented. The objective of the research on which this article is based was to establish what IFRSs require in terms of the disclosure of assumptions and estimation uncertainty and also if listed companies in the construction and materials sector comply with these disclosure requirements.

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