Accounting · Depreciation Accounting
When an enterprise changes its method of depreciation from Straight Line Method (SLM) to Written Down Value (WDV) method, how should this change be accounted for under current accounting standards (Ind AS 16 / AS 10)?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The cumulative differential impact since acquisition must be adjusted directly in current P&L as an exceptional item.
- 2The change is strictly prohibited unless approved by legal restructuring or corporate merger.
- 3It is a change in accounting estimate applied prospectively over the remaining useful life of the asset.✓
- 4It is a change in accounting policy applied retrospectively by restating prior period financial statements.
Correct answer
It is a change in accounting estimate applied prospectively over the remaining useful life of the asset.
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