Period Cost and its Impact on Financial Statement
Period Cost and its Impact on Financial Statement

Summary/Abstract: Period costs are extremely important for financial disclosure because they are running directly in the P&L account, having an immediately impact on income statement, and thus on financial performance.In the management accounting, period costs are deducted from revenues without ever having been included as part of inventory, whereas in the financial accounting they are assigned to the accounting period.In this paper we posit that employees benefits (IAS19) represent period costs,highlighting the main difference in treatment of fringe benefits on the short term and on the long run, where accrual approach intervenes. (IAS37).

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