Different forms of Capital Maintenance in Units of Constant Purchasing Power
The following are all forms of Capital Maintenance in Units of Purchasing Power:
1. Indexation in countries with high or hyperinflation
2. Monetary correction in countries with high or hyperinflation.
3. Price-level accounting
4. Price-level restatement by, for example, the Central Bank of Chile.
5. Restatement of Historical Cost or Current Cost financial statements in terms of the measuring unit current at the balance sheet date during hyperinflation (IAS 29).
None of the above would result in ideal Capital Maintenance in Units of Constant Purchasing Power with 100 percent of the constant purchasing power of capital maintained if the following condition were not met:
1. Implementation of a daily index (e.g., the Daily CPI) which generally recognizes all changes in the general price level.
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