AOL ASSIGNMENT There were two accounting policies used by AOL that were considered aggressive‚ as well as controversial. The first was to amortize its software development costs and the second was to capitalize subscriber acquisition costs. The lifetime‚ for amortization purposes‚ which AOL assigned to software development costs was five years. This was considered by many to be an exceptionally long time considering the pace at which technology was progressing during that period of time.
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Financial Accounting and Reporting Case: America Online 1. What accounting approach has AOL used in the past that it is now changing (related to the $385 million)? AOL‚ prior to October 1‚ 1996‚ recorded the expenditure related to subscribers acquisitions as an asset and amortized monthly over a period < 24 months. This was a strongly criticized approach. Furthermore‚ the accounting approach in the article is considered aggressive. In October 1996‚ they discontinued capitalizing customer acquisition
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Abstract The aim of this short paper is targeted at broadening general understanding of the impact of accounting for goodwill in the Non-for-Profit environment based on its financial practicability and how a focus on the fair value of goodwill goes to the heart of the value of an Organization. Various amendments and new accounting rules; Enron and WorldCom misfortunes; Ponzi Schemes and other white collar financial frauds have brought about stricter governance and financial statement reporting responsibilities
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The introduction of MRRT will potentially have an effect on the accounting policy choices of mining companies affected by the tax. This paper will be split into two sections; a literature review and an analysis. The literature review will look at articles on the Minerals Resource Rent Tax and what it actually entails. Positive Accounting Theory in relation to bonus plans and political costs. It will address articles on accounting methods that were used prior to the introduction of Minerals Resource
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Name: Section: University of Toronto At Mississauga Financial Accounting Theory & Policy I MGT 224 Mid-Term October 23‚ 2006 6:10-7:40 p.m. Instructions: 1. This is a ninety minute examination. 2. The test consists of two short exercises and one case. Please show your calculations. For the case analysis‚ use the case analysis framework as discussed in class. 3. You are allowed to use only a non-programmable calculator. No other aids are allowed. 4. You may
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Discussion Questions 1. What is the main thrust of the strategy that AOL has been pursuing? In 1999‚ the major problem facing the “AOL Anywhere” strategy was how high-speed‚ broadband technologies would impact the company’s future growth. If AOL were to remain dominant against its competitors‚ it‚ too‚ would have to offer broadband access. Indeed‚ the emergence of broadband was the motivation behind the AOL/Time Warner merger‚ which was announced on January 10‚ 2000. The merged company became
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NON-MERCHANDISE PAYABLES Adding New Vendors Must attach copy of invoice (coded with account and cost centre‚ signed by authorizing manager‚ and stamped by finance rep) Exceptions: FLEX‚ SORD‚ and utility invoices Check vendor ID in PeopleSoft to ensure that it does not already exist For proper names (i.e. John Doe)‚ use the first three letters of the last name and then the first three letters of the first name for the vendor ID (i.e. DOEJOH) Complete and mark all applicable fields on the
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During the 90s‚ AOL was typically the first production to the Internet for most people. AOL was a very simple and easy to use online service that provided high quality service to millions of users. AOL offered a tremendous number of services to their customers at a very reasonable price. Typically‚ you could spend ten minutes or ten hours a day on AOL‚ all for for the same price. People loved the service because all their content was fresh and the sign up was very easy. Today‚ AOL remains one of the
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AOL Case Study 1. What accounting approach has AOL used in the past that it is now changing (related to the $385 million)? Prior to October 1‚ 1996‚ AOL accounted for the cost of direct response advertising as "Deferred Subscriber Acquisition Costs‚" i.e.‚ it recognized (reported) the costs of mailing out diskettes allowing you to sign-on to AOL for 100 free minutes as an asset on its Balance Sheet. In accounting‚ we say that the costs were "capitalized‚" meaning reported on the Balance Sheet
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Accounting Policies Introduction Within the financial statements there is a section that discloses the accounting policies used by the company for the financial year. The purpose of this will be discussed in this assignment while being applied to Morrison’s final accounts. The IASB will also be discussed; the discussion will include legislation which will show the legal requirements that the company has to keep to. It will then go on to explain why they may use those policies and who do they
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