Fairness Of The Financial Report In Pt Bentoel Tbk (Study Conversion Historical Cost Accounting Into General Price Level Accounting)

Abstract

Financial report is important information for the management, the owner, the analysis, the banker, the creditor and the public. Information that give an activities about financial condition in period of time. For the developed country such as Indonesia has some problems related to the inflation. So, in making financial report that always use historical cost will be uncertainly or the condition of financial report become no longer relevance for the real market condition. In order to solve that problem we need some solution that can explain the real financial report that match with the condition market and evaluate it. So, we know that financial statement is fair and the different between historical and general price is not material. There are several concepts on accounting for this effect of changing prices, such as constant accounting, current cost accounting, and the combination of two methods between constant and current cost accounting. General price level accounting will do restatement of the financial report in inflation period that represent financial report historical cost and make it to be match with the purchasing power then will create financial report that relevant in inflation condition. Based on analysis result, using general price level method for financial report (balance sheet and income statement), we have the differences between financial report before converted and after converted that saying, the differences that happen still fair because the value is not material.