Tarea

RESTATEMENT OF FINANCIAL CONDITION FOR EFFECTS OF INFLATION The main purpose of restating financial statements is to adapt to the reality of inflation that prevailed in thecountry in recent years so that they can continue to provide adequate information. Due to high inflation rates the financial statements used to date, expressed inhistorical costs do not provide adequate information introducing serious distortions in the results of companies.

1. MEANING OF THE EXPRESSION OR UPDATE. The Restatement meanstransforming historical values ​​that have different purchasing power in monetary units equivalent to the same purchasing power that exists at the time of the update. This isused for the consumer price index (CPI), provided by the Central Bank, which serve to measure the purchasing power of money and hence inflation. It is then to correct thepurchasing power of the currency, which yesterday cost expressed in monetary terms today. Example: In January 1986, he bought a plot in 5000000 and the CPI was 119.3, assumingthat the price of land varies in direct proportion to inflation, its value at 12.31.91, with a CPI of 812.7, is of (5,000,000) x (812.7/119.3) = 34 million.

2. STATEMENTAS AN EXPRESSION ACCEPTED ACCOUNTING PRINCIPLE 1. The Federation of Public Accountants issued Statement of Accounting Principles the number NIF B-10, "Standards for thePreparation of Financial Statements Adjusted for the effects of inflation", effective for periods that began in January 1993 . 2. Those entities that choose to submit updatedfinancial statements as unique, will meet with accounting principles generally accepted. 3. The standards are applicable to the basic financial statements: • Balance Sheet.