Maamba Ltd operates both wholesale and retail shop of ladies footwear at Makola. The 2021 financial statement of the company is still in draft form and PKF audit firm, the external auditor of the company carries out the audit on the financial statement which will be authorized in April, 2019 during the Annual General Meeting.

Maba Ltd warehouse at Makola which contained inventory worth GH₵ 1,300,000 was destroyed by fire when the market was gutted by fire on 2^nd January, 2022. Unfortunately, Maamba Ltd has no insurance cover for this loss. The inventory value in the 2021 financial statement includes the destroyed inventory.

Required: 

Identify the applicable International Accounting Standard and the appropriate accounting treatment

Answer rating: 100% (QA)

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