Lesson: Types of Accounting Changes

In this lesson, delve into the intricate world of accounting changes and error corrections with Nick Palazzolo. Nick breaks down the three main categories: changes in accounting principles, accounting estimates, and reporting entities. He illustrates each type with tangible examples, such as moving from one GAAP principle to another, revising estimates due to new information, or adjusting the approach to entity reporting. Plus, he clearly distinguishes these from accounting errors, highlighting that they are not to be mixed up with regular accounting changes. Whether it's adopting new FASB standards, changing inventory methods, or revising depreciation practices, this lesson demystifies the complex transitions that can occur in the accounting landscape.