This report analyses the accounting policies of Marks and Spencer from two sides: in order to assess their usefulness, and to determine the degree of transition towards international financial reporting standards (IFRS). The first part of the report analyses the development of two accounting policies regarding tangible fixed assets and intangible one. To make the analysis more critical, comparisons with the main competitors of Marks and Spencer are drawn illustrating the controversial development of the selected policies. The second part of the report deals with the analysis of transition from UK GAAP to IFRS with specific respect to the following issues: treatment for property, property leases, employee benefits, share-based payments, intangible assets, and financial instruments.
During their lifetime companies acquire property, which should be treated as assets according to the accounting standards. Meanwhile most of the property types have a 'lifetime' span, a time period, called useful economic life, during which an asset is used. To reflect the useful economic life in financial statements, profit and loss account receives regular portion of the cost of an asset. This expense is known as depreciation. In other words, depreciation represents the extent to which economic value of an asset has been consumed by the business. ...Show more