I'm back following a 10 drip to Provence, that's France you know! I've kept a sort of diary that will keep you riveted but first: Joyce from Korea wanted answers to a couple of IAS based questions: done and sent! Natalie from South Africe is receiving ongoing advice on the elements of budgets: doing that! Karin from Austria is receiving ongoing help on knowledge management: doing that! Tom describes himself as a Mature student struggling with bookkeeping and has asked for help with my specimen question ... I need to know which question he means! Sarah from Geordieland has started a dissertation relating to Marks and Spencer and we are discussing her overall plan: doing that! Clive from Birmingham is an accountant who has come across a fascinating Benford's Law type problem involving the Inland Revenue: looks to me as if the IR is making a mess of it and I am working with Clive to sort it all out: doing that! Andrew from Surrey wants a bit of technical help on the bookkeeping aspect of recording bad debts: doing that! Mahmood from India wants to know why LIFO is being taken out of IAS 2: this is what I told him ... Hi Mahmood, Good question: here’s the answer! LIFO was banned in many countries, eg the UK, for a long time and then IAS 2 came along and allowed it. However, after just a few years even the IASC is about to disallow LIFO. The reason is that LIFO provides an organisation with a potential taxation advantage over alternative stock valuation methods. To prove that this is true, set up a simple stock valuation question for yourself by inventing some purchases, usages, costs and sales of some raw materials and then prepare the stock record card using … make sure that you build in cost inflation FIFO LIFO AvCo then prepare the Trading and Profit and Loss Account and compare the answers you get. This will help you to see what LIFO can be a problem. However, the USA has always liked and allowed LIFO and continues to do so as far as I know! Let me know if you need any more help. Best wishes Watch out for the French Trip Diary: a week in Provence I'm calling it! DW