IFRS permits inventory reductions due to lower of cost or market write-downs to be reversed if the market recovers.

Question

Quizplus · Accepted Answer

This is true according to IFRS. If an inventory write-down was made due to a lower of cost or market valuation and the market subsequently recovers, the write-down can be reversed up to the original cost of the inventory. However, the reversal must be disclosed in the financial statements and cannot exceed the amount of the original write-down.

IFRS Permits Inventory Reductions Due to Lower of Cost or Market