ACCA FR Syllabus A. The Conceptual And Regulatory Framework - Current Cost accounting - Notes ^{4 / 4}

It is usually calculated by adjusting the historical cost for inflation.

The current operating profit is considered to be more relevant to many decisions such as dividend distribution, employee wage claims and even as a basis for taxation

The problems that current cost accounting (and other approaches to accounting for inflation) attempt to solve are obviously linked to inflation.

In practical terms, it can be very difficult to determine the current value of assets. It is often subjective and complex.