Changes in accounting policies and estimates


The requirements in IFRSs, in particular in IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, make a distinction between how an entity should present and disclose different types of accounting changes in its financial statements. Changes in accounting policies must be applied retrospectively while changes in accounting estimates are accounted for prospectively.

Companies sometimes struggle to distinguish between accounting policies and accounting estimates and enforcers have identified divergent practices. Therefore, the Interpretations Committee received a request to clarify the distinction. The Interpretations Committee observed that it would be helpful if more clarity were given and brought the issue to the IASB’s attention for future consideration as part of the disclosure initiative.


Current status of the project

This project has been completed. The IASB issued Definition of Accounting Estimates (Amendments to IAS 8) on 12 February 2021.


Project milestones

Date Development Comments
May 2015
Project formally added to the IASB agenda
12 September 2017
ED/2017/5 Accounting Policies and Accounting Estimates (Proposed amendments to IAS 8) published
Comments requested by 15 January 2018
12 February 2021
Definition of Accounting Estimates (Amendments to IAS 8) issued
The amendments are effective for annual periods beginning on or after 1 January 2023.


Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.