Impact of alternative methods of accounting for depreciation on the income statement and statement of financial position ((Case study of the Educational Supplies Company / Iraqi Ministry of Education))

Abstract

The aim of the research is to highlight the importance of using the methods of calculating depreciation and its impact on the statement of income statement and the statements of the financial position. It chooses from the methods of extinction what achieves its objectives, and therefore the financial statements do not reflect the results of the business (income statement and financial position (the budget correctly?)) On this basis, the hypothesis was formulated to answer the question, and through research and application of methods for calculating extinction, the researcher reached the following

• The establishment is committed to calculating the depreciation of fixed assets in order to extract the net fixed assets in the statement of financial position and to find out the entity’s instrument of profit and loss in the income statement.
• The amount of depreciation on fixed assets is extracted in several ways, but the amount of depreciation varies according to the method used.

So the researcher recommends

The establishment can use an alternative method in calculating the amount of depreciation, but the responsibility of the establishment when using an alternative method is to fully disclose and indicate the reasons for the change and its consequences in the financial statements and present them to the beneficiaries