Prior Period Adjustment
Correction of an error (Prior Period Adjustment)
- Errors are corrected as of the first period discovered.
- Arises from such items as
- Mathematical mistake.
- Oversights, misuse of facts, misinterpretations or misclassifications.
- Not GAAP to GAAP is the correction of an error.
- Please refer back to chapter 4.
- Unethical prior estimates results in a prior period adjustment.
- Presentation: Net of tax as an adjustment to the beginning balance of RE