Вы находитесь на странице: 1из 3

Philippine Public Sector Accounting Standard 12

INVENTORIES

Table of Contents
PAG
Number
BACKGROUND
INTRODUCTION TO THE IPSAS 12
PHILIPPINE APPLICATION GUIDANCE TO IPSAS 12
Scope

Cost Formulas

Effective Date

PPSAS 12- Inventories


January 2014
Page 1

Philippine Public Sector Accounting Standards 12


INVENTORIES
Background
This Philippine Public Sector Accounting Standard (PPSAS) 12 consists of
International Public Sector Accounting Standard (IPSAS) 12, Inventories,
and the Philippine Application Guidance (PAG) prepared to suit the
Philippine public sector situation.
The IPSAS 12 was issued in July 2001 and revised in December 2006 by
the International Public Sector Accounting Standards Board (IPSASB) of the
International Federation of Accountants (IFAC). This includes amendments
resulting from IPSASs issued up to January 15, 2012.
The PAG (in italics) provides supplementary guidance on the proper
implementation of IPSAS 12.
Introduction to the IPSAS 12
IPSAS 12 sets out the accounting treatment for inventories. A primary
issue in accounting for inventories is the amount of cost to be recognized
as an asset and carried forward until the related revenues are recognized.
This Standard provides guidance on the determination of cost and its
subsequent recognition as an expense, including any writedown to net
realizable value. It also provides guidance on the cost formulas that are
used to assign costs to inventories.
Philippine Application Guidance to IPSAS 12
Scope
PAG1.Paragraph 4 deals with the applicability of this Standard to all public
sector entities other than Government Business Enterprises (GBEs).
GBE is an entity that has all the following characteristics: (a) Is an
entity with the power to contract in its own name; (b) Has been
assigned the financial and operational authority to carry on a
business; (c) Sells goods and services, in the normal course of its
business, to other entities at a profit or full cost recovery; (d) Is not
reliant on continuing government funding to be a going concern
(other than purchases of outputs at arms length); and (e) Is
controlled by a public sector entity.
This standard shall be applied to all National Government Agencies
(NGAs), Local Government Units (LGUs) and Government-Owned
and/or Controlled Corporations (GOCCs) not considered as GBEs.
PPSAS 12- Inventories
January 2014
Page 2

Cost Formulas
PAG2.Paragraph 32 provides that the cost of inventories of items that are
not ordinarily interchangeable, and goods and services produced
and segregated for specific project, shall be assigned by using
specific identification of their individual costs.
Paragraph 35, on the other hand, deals with the assignment of cost
of inventories using the First-in-first-out (FIFO) or weighted average
cost formulas items that are not specifically identifiable.
For consistency and uniformity in costing inventories, the weighted
average shall be adopted for items that are not specifically
identifiable.
Effective Date
PAG3.This PPSAS shall apply for annual financial statements covering
periods beginning January 1, 2014.

PPSAS 12- Inventories


January 2014
Page 3

Вам также может понравиться