Client X operates in the US currently and is planning to expand operations globally next year. As a result, management is considering preparing financial statements in accordance with IFRS rather than with US GAAP.

Client X contacted you for clarification and recommendations regarding the following issues:

1. How the use of the LIFO method to value its inventories will be impacted if a switch to financial statements prepared in compliance with IFRS will be made.

2. Whether interest cost on construction of a new warehouse may be included in the cost of the new warehouse.

3. In what instances should goodwill be adjusted for impairment?