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- Title
FINANSIJSKO IZVJEŠTAVANJE I INFLACIJA.
- Authors
Altumbabić, Vildana
- Abstract
Informations in financial statements have a great importance for all their users, primarily for investors and owners especially in proces of making decisions on investment and resource allocation. The relevance and comparability of this information is essential for the trust of all users, therefore it is important to ensure that it is not violated. There are many factors that can have an impact on the relevance and comparability of informations in financial statements but two factors are crucial: inflation and the choice of accounting policies. If these factors are not carefully considered, a wrong picture of the company’s financial position and performance can be obtained. Inflation can have a significant impact on financial statements and the level of the reported financial result, as well as on comparability of data, planning and management of cash flows. It is necessary to harmonize financial statements for the effects of inflation, to achive a comparability of data from financial statements in inflationary conditions. According to the latest available data from the BiH Agency for Statistics, the inflation rate measured by the consumer price index is 14.4%. Therefore, the topic of this paper is inflation and its impact on planning, reliability and comparability of data from financial statements and cash flow management. The goal is to consider the current level of inflation in BiH and whether there is a need to apply the provisions of IAS 29, that is, how to “eliminate” the effects of inflation on financial statements and adequately plan and manage cash flows. The paper consists of three parts. In the first part, inflation is considered as an economic phenomenon and its level and movement in Bosnia and Herzegovina. In the second part, the qualitative characteristics of financial information and the factors that influence them are considered. In the third part, the need and ways to adjust financial statements and plans for the effects of inflation are considered. According to research results, inflation has an impact on financial reporting, so it is necessary to consider ways of adjusting for its effects.
- Subjects
BOSNIA &; Herzegovina; CASH management; BUSINESS enterprises; DECISION making in investments; ACCOUNTING policies; INVESTORS; CONSUMER price indexes; FINANCIAL statements
- Publication
Business Consultant / Poslovni Konsultant, 2023, Vol 14, Issue 126, p6
- ISSN
1986-5538
- Publication type
Article