present and potential investors and creditors and other users in making rational investment‚ credit‚ and similar decisions‖ [FASB‚ SFAC 1‚ para. 34]. To achieve that objective‚ ―financial reporting should provide information to help investors‚ creditors‚ and others assess the amounts‚ timing‚ and uncertainty of prospective net cash inflows to the related enterprise‖ [FASB‚ SFAC 1‚ para. 37]. It should also ―provide information about the economic resources of an enterprise‚ the claims to those resources
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Chapter 15 Accounting in a Global Market QUESTIONS 1. Foreign currency exchange rates are used to express transactions in local currency in terms of U.S. dollars and vice versa. For example‚ if the exchange rate is $1 = 1.65 DM (Deutsche mark)‚ and if one wishes to change 100 U.S. dollars into Deutsche marks‚ one will receive $100 ( 1.65 = 165 DM‚ and if one wishes to change 100 DM to U.S. dollars‚ one will receive 100 DM/1.65 = $60.61. 2. A foreign currency transaction occurs when a transaction
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Introduction Schipper (2003) who is a member of FASB conducted a study on the rules-based and principles-based accounting standards. The aim of this article is to discuss the attributes and potential effects of transferring from rules-based standards to principles-based standards. To some extent this article is critical‚ but several limitations need to be discussed‚ such as implementation guidance. Summary Schipper (2003) demonstrated that there was a long-running debate on whether U.S. GAAP
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the difference between the United States accounting standards and International accounting standards. The United States uses the Financial Accounting Standards Board (FASB) to issue financial reporting procedures. The International Financial Reporting Standards (IFRS) are issued by the International Accounting Standards Board (IASB). There are proposals for the United States to adopt the International standards. Financial reporting procedures are debated about the United States using the Generally
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ratio‚ profit margin‚ asset utilization‚ and financial leverage. Discussions in this paper include how the differences of each industry affect presentations as they relate to different International Accounting Standards Board (IASB) and Financial Accounting Standards Board (FASB) measurement conventions‚ and on how uses of the cash basis of accounting differ from the accrual basis of accounting. Mercedes Benz (dollars are in millions) In 2009‚ Mercedes Benz had a total of $27‚964 in current
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CHAPTER 2 Conceptual Framework for Financial Reporting ASSIGNMENT CLASSIFICATION TABLE (BY TOPIC) Topics 1. 2. 3. 4. 5. 6. Conceptual framework– general. Objectives of financial reporting. Qualitative characteristics of accounting. Elements of financial statements. Basic assumptions. Basic principles: a. Measurement. b. Revenue recognition. c. Expense recognition. d. Full disclosure. Accounting principles– comprehensive. Constraints. Assumptions‚ principles‚ and constraints. 28‚ 29‚ 30 10 11 Questions
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field of accountancy. These organizations include the Financial Accounting Standards Board (FASB)‚ the Public Company Accounting Oversight Board (PCAOB)‚ the Securities and Exchange Commission (SEC)‚ and the International Accounting Standards Board (IASB). Companies which operate within the United States must compile financial reports within the guidelines set forth by the (SEC) and the (FASB); the (FASB) ensures that all companies focus on the characteristics of relevance and reliability when generating
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already existing going concern reporting model and disclosures. This project was added to provide guidance for entities in assessing their ability to continue as a going concern‚ and the timing‚ nature and extent of associated disclosure requirements (FASB‚ 2013). Finally these standards would help management decide where disclosure is appropriate. Alternative approaches In terms of alternatives IFRS defines going concern as the period in the foreseeable future (Finance Train‚ 2013). According to IAS
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Campbell Soup Company 1. Identify legitimate business practices that corporate executives can use for the primary purpose of manipulating or “managing” their company’s reported operating results. Are such practices ethical? Defend your answer. Some examples of legitimate business practices that executives can use to manage their company’s reported operating results include: offering customers extended payment terms at the end of the a period to accelerate sales‚ recording generous reserves
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Financial Reporting Council decided in 2002 that Australian would move to International Financial Reporting Standards (IFRS) in 2005. Prior to that‚ Australia had its own standard-setting processes. The introduction of IFRS in Australia replaced the original accounting standards and brought several brand new standards. Until now‚ Australia was the first country with a tradition of its own standard-setting to implement international accounting standards for general purposes. Therefore‚ the adoption is
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