Inventory Valuation — Accounting and Tax Methods

Inventory valuation is a fundamental accounting aspect that directly influences financial results. Method selection must consider business specifics and fiscal implications.

Accepted valuation methods in Romania

• FIFO (First In, First Out)
• Weighted average cost
• Specific identification
• LIFO — NO longer permitted under IFRS and Romanian regulations

Fiscal impact of chosen method

FIFO tends to generate higher accounting profit in inflationary periods, while weighted average provides more stable values. The choice must be maintained consistently.

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