The company should adopt the new accounting method from the third quarter onwards, using the calculated impact on the first and second quarter financial statements for informed decision-making.
In the third quarter of the current year, the company should implement the new inventory accounting method. While calculating the impact on the first and second quarter financial statements is informative, the decision to adopt the new method should be prospective, starting from the third quarter onward. This ensures consistency and comparability in financial reporting. The calculated impact helps in understanding the retrospective effect on prior periods and guides the company in making informed decisions. Prospective implementation maintains transparency and coherence in financial statements, allowing stakeholders to comprehend the company's performance with a uniform accounting approach. By adopting the new method in the current quarter, the company demonstrates a commitment to accurate and reliable reporting, aligning its practices with calculated impacts and enhancing the overall credibility of its financial statements for the remainder of the year and beyond.