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CPA Exam - FAR > 1A. Conceptual Framework, Standard-Setting and Financial Reporting > Flashcards

1A. Conceptual Framework, Standard-Setting and Financial Reporting Flashcards

1
Q

3 Basic Assumptions

  1. ?????
  2. Economic Entity
  3. Unit of Measure
A

Going Concern

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2
Q

3 Basic Assumptions

  1. Going Concern
  2. ????
  3. Unit of Measure
A

Economic Entity

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3
Q

3 Basic Assumptions

  1. Going Concern
  2. Economic Entity
  3. ?????
A

Unit of Measure

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4
Q

Going Concern Assumption

A

A business that functions without the threat of it liquidating in the near future (usually within 12 months)

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5
Q

Economic Entity Assumption

A

Pretty much any time of organization or unit in society can be an economic entity

Ex: Hospitals, companies, municipalities

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6
Q

Unit of Measure Assumption

A

Information reported should be measured in the national monetary unit

Ex: the US Dollar

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7
Q

What are the two Qualitative Characteristics at the top of the chart?

  1. ????
  2. Faithful Representation
A

Relevance

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8
Q

What are the two Qualitative Characteristics at the top of the chart?

  1. Relevance
  2. ????
A

Faithful Representation

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9
Q

What is the Relevance Qualitative Characteristic?

A

Capable of making a difference in the decisions made by users.

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10
Q

3 Characteristics Relevance consists of

  1. ???
  2. Confirmatory Value
  3. Materiality
A

Predictive Value

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11
Q

3 Characteristics Relevance consists of

  1. Predictive Value
  2. ???
  3. Materiality
A

Confirmatory Value

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12
Q

3 Characteristics Relevance consists of

  1. Predictive Value
  2. Confirmatory Value
  3. ?????
A

Materiality

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13
Q

What is Predictive Value

A

Information that helps users in predicting or anticipating future outcomes

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14
Q

Is Predictive Value part of Relevance or Faithful Representation?

A

Relevance

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15
Q

What is Confirmatory Value?

A

It enables users to check and confirm earlier predictions or evaluations

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16
Q

Is Confirmatory Value part of Relevance or Faithful Representation?

A

Relevance

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17
Q

What is Materiality?

A

Information is material if it is significant enough to influence the decision of users.

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18
Q

Is Materiality part of Relevance or Faithful Representation

A

Relevance

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19
Q

Faithful Representation

A

Information should actually represent what it’s claiming to represent

In other words, the information should show what is present and what really happened

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20
Q

3 Characteristics Faithful Representation Consists of

  1. ????
  2. Neutrality
  3. Free from Error
A

Completeness

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21
Q

3 Characteristics Faithful Representation Consists of

  1. Completeness
  2. ????
  3. Free from Error
A

Neutrality

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22
Q

3 Characteristics Faithful Representation Consists of

  1. Completeness
  2. Neutrality
  3. ????
A

Free from error

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23
Q

Can you name the 3 Characteristics of Faithful Representation without seeing the other 2?

A

Completness
Neutrality
Free From Error

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24
Q

Can you name the 3 Characteristics of Relevance without seeing the other 2?

A

Predictive Value
Confirmatory Value
Materiality

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25
Q

Completeness

A

Adequate of full disclosure of necessary information in financial Statements

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26
Q

Is Completeness part of Relevance or Faithful Representation?

A

Faithful Representation

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27
Q

Neutrality

A

Fairness and freedom from bias

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28
Q

is Neutrality part or Relevance of Faithful Representation

A

Faithful Representation

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29
Q

Free from Error

A

No inaccuracies or omissions in financial statements

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30
Q

Is “Free from Error” part or Relevance of Faithful Representation

A

Faithful Representation

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31
Q

Enhancing Qualitative Characteristics

  1. ?????
  2. Verifiability
  3. Timeliness
  4. Understandability
A

Comparability

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32
Q

Enhancing Qualitative Characteristics

  1. Comparability
  2. ????
  3. Timeliness
  4. Understandability
A

Verifiability

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33
Q

Enhancing Qualitative Characteristics

  1. Comparability
  2. Verifiability
  3. ?????
  4. Understandability
A

Timeliness

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34
Q

Enhancing Qualitative Characteristics

  1. Comparability
  2. Verifiability
  3. Timeliness
  4. ?????
A

Understandability

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35
Q

Name all 4 Enhancing Qualitative Characteristics

A

Comparability
Verifiability
Timeliness
Understandability

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36
Q

Comparability

A

Comparable information enables comparisons within the entity (ex: from different periods) and across entities

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37
Q

Verifiability

A

helps to assure users that information represents faithfully what it purports to represent.

Financial information is supported by evidence and independent individuals can check them to see whether such information is faithfully represented. In other words, information is verifiable if it can be audited.

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38
Q

Understandability

A

requires financial information to be understandable or comprehensible to users with reasonable knowledge of business and economic activities.

To be understandable, information should be presented clearly and concisely.

However, it is improper to exclude complex items just to make the reports simple and understandable.

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39
Q

Basic Accounting Principles

  1. ?????
  2. Consistency
  3. Matching Principle
  4. Conservatism
A

Substance over form

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40
Q

Basic Accounting Principles

  1. Substance over Form
  2. ?????
  3. Matching Principle
  4. Conservatism
A

Consistency

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41
Q

Basic Accounting Principles

  1. Substance over Form
  2. Consistency
  3. ??????
  4. Conservatism
A

Matching Principle

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42
Q

Basic Accounting Principles

  1. Substance over Form
  2. Consistency
  3. Matching Principle
  4. ??????
A

Conservatism

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43
Q

Substance over Form

A
  • An accounting principle which recognizes that business transactions should be accounted in accordance with their (economic) substance instead of their (legal) form.
    • An example of this is a sale leaseback in which Company A has a truck it sells to company B, then subsequently leases it from them.
      ○ Although the legal ownership of the assets has transferred but the underlying economics remains the same and hence under the substance over form principle the sale and subsequent leaseback are looked at as one transaction.
      ○ The company cannot just remove the fleet from its balance sheet because the legal ownership has changed. It will continue to recognize the fleet as an asset and shall also record a lease liability that arise out of the associated lease-back.
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44
Q

Consistency

A

once you adopt an accounting principle or method, you should continue to use it until a demonstrably better principle or method comes along.

Not following the consistency principle means that a business could continually jump between different accounting treatments of its transactions that makes its long-term financial results extremely difficult to discern

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45
Q

Matching Principle

A

The concept that, when you record revenue, you should record all related expenses at the same time. Thus, you charge inventory to the cost of goods sold at the same time that you record revenue from the sale of those inventory items. This is a cornerstone of the accrual basis of accounting. The cash basis of accounting does not use the matching the principle.

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46
Q

Conservatism

A

Record expenses as soon as possible

Record revenues and assets only when you are sure they will occur

This introduces a conservative slant to the financial statements that may yield lower reported profits, since revenue and asset recognition may be delayed for some time. Conversely, this principle tends to encourage the recordation of losses earlier, rather than later. This concept can be taken too far, where a business persistently misstates its results to be worse than is realistically the case.

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47
Q

Revised Uniform Partnership Act (RUPA)

A

The partnership agreement creates the rights and duties for partners, not partnership law

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48
Q

Which Partnerships does RUPA apply to?

A

Limited Liability Partnerships (LLP) and General Partnerships

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49
Q

Which Partnership does RUPA not apply to?

A

Limited Partnerships (LP)

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50
Q

In RUPA partners are free to include and exclude various rights in their agreements, but they are prohibited from doing the following…

  1. ???????
  2. Eliminating or unreasonably reducing the partners’ duty of care to one another
  3. Eliminating the partners’duty of loyaltyor obligation ofgood faith and fair dealing
  4. denying a partner the right to withdraw from the partnership
A

restricting a partner’s access to the books and records of the company

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51
Q

In RUPA partners are free to include and exclude various rights in their agreements, but they are prohibited from doing the following…

  1. restricting a partner’s access to the books and records of the company
  2. ??????
  3. Eliminating the partners’duty of loyaltyor obligation ofgood faith and fair dealing
  4. denying a partner the right to withdraw from the partnership
A

Eliminating or unreasonably reducing the partners’ duty of care to one another

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52
Q

In RUPA partners are free to include and exclude various rights in their agreements, but they are prohibited from doing the following…

  1. restricting a partner’s access to the books and records of the company
  2. Eliminating or unreasonably reducing the partners’ duty of care to one another
  3. ????
  4. denying a partner the right to withdraw from the partnership
A

Eliminating the partners’duty of loyaltyor obligation ofgood faith and fair dealing

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53
Q

In RUPA partners are free to include and exclude various rights in their agreements, but they are prohibited from doing the following…

  1. restricting a partner’s access to the books and records of the company
  2. Eliminating or unreasonably reducing the partners’ duty of care to one another
  3. Eliminating the partners’duty of loyaltyor obligation ofgood faith and fair dealing
  4. ???????
A

denying a partner the right to withdraw from the partnership

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54
Q

In RUPA partners are free to include and exclude various rights in their agreements, but they are prohibited from doing the following 4 things…

A
  1. restricting a partner’s access to the books and records of the company
  2. Eliminating or unreasonably reducing the partners’ duty of care to one another
  3. Eliminating the partners’duty of loyaltyor obligation ofgood faith and fair dealing
  4. denying a partner the right to withdraw from the partnership
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55
Q

How does RUPA Require Profit & losses to be treated in a partnership if there is no sharing agreement specified in the partnership agreement

A

profit and losses to be shared equally if it is not specified in partnership agreement

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56
Q

Currency Transaction Report (CTR)

A
  • areportthat U.S. financial institutions are required to file with FinCEN for each deposit, withdrawal, exchange ofcurrency, or other payment or transfer, by, through, or to the financial institution which involves atransactionincurrencyof more than $10,000.
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57
Q

GASB Concept Statements NO 2 - Measures on Service Accomplishments

A

Focus on outputs and outcomes

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58
Q

What is an Asset Valuation Account

A

A separate item that increase or reduced the carrying amount of an asset

It is neither an asset of liability itself

Ex: Uncollectible Accounts reduces receivables amount expected to be collected

Ex: Premium on bond receivable increases the receivable to its cost or PV

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59
Q

In the IFRS Hierarchy of Guidance - What is the first step when selecting an accounting policy in a particular situation

A

To determine if there’s an IFRS that applies to that transaction or event

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60
Q

Realization

A

Converting a non Cash resource into cash

Ex: Depreciated Equipment was sold in exchange for a note receivable
- Equipment (non cash resource) sold for note (claim to cash)

Not an example: Collecting Cash on A/R

	Because A/R is a claim to cash so it's cash to cash
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61
Q

Why is Selling Depreciated Equipment in exchange of a note receivable an example of Realization?

A

Because it is an exchange of a non cash resource for a claim to cash (note receivable)

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62
Q

Why is Collecting Cash from an A/R not an example of realization?

A

Because A/R is a claim to cash so it’s cash to cash

Realization should be non cash to cash

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63
Q

Objective of SFAC (Statements of Financial Accounting Concepts)

A

Objectives are designed to constitute a foundation of financial accounting standards

The framework is designated to prescribe the nature, function and limits of financial accounting and to be used as guideline that will lead to consistent standards

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64
Q

IFRS non-cash investing and financing activities - Where is that reported

A

Reported in notes to financial statements

65
Q

When converting Accrual Basis to cash basis - How is an increase in A/R treated

A

Subtract increase in A/R

66
Q

Why is A/R subtracted from Accrual Basis to convert to cash basis

A

Because it means that sales have been recorded but cash has not been collected

67
Q

3 Primary User Groups of External Financial Reports of State Government

  1. ?????
  2. Legislative & Oversight who represent the citizenry
  3. Investors & Creditors who lend or participate in the lending process
A

Citizenry to which government is accountable

68
Q

3 Primary User Groups of External Financial Reports of State Government

  1. Citizenry to which government is accountable
  2. ???????
  3. Investors & Creditors who lend or participate in the lending process
A

Legislative & Oversight who represent the citizenry

69
Q

3 Primary User Groups of External Financial Reports of State Government

  1. Citizenry to which government is accountable
  2. Legislative & Oversight who represent the citizenry
  3. ???????
A

Investors & Creditors who lend or participate in the lending process

70
Q

Name all 3 Primary User Groups of External Financial Reports of State Government

A
  1. Citizenry to which government is accountable
  2. Legislative & Oversight who represent the citizenry
  3. Investors & Creditors who lend or participate in the lending process
71
Q

Purpose of IASB Conceptual Framework

  1. ??????
  2. Assist preparers of F/S in applying IFRS
  3. Assist auditors in forming opinions on whether F/S comply with IFRS
A

Assist board in development of future IFRS

72
Q

Purpose of IASB Conceptual Framework

  1. Assist board in development of future IFRS
  2. ?????
  3. Assist auditors in forming opinions on whether F/S comply with IFRS
A

Assist preparers of F/S in applying IFRS

73
Q

Purpose of IASB Conceptual Framework

  1. Assist board in development of future IFRS
  2. Assist preparers of F/S in applying IFRS
  3. ???????
A

Assist auditors in forming opinions on whether F/S comply with IFRS

74
Q

Name all 3 purposes of IASB Conceptual Framework

A
  1. Assist board in development of future IFRS
  2. Assist preparers of F/S in applying IFRS
  3. Assist auditors in forming opinions on whether F/S comply with IFRS
75
Q

3 Tiers of IASB Hierarchy

  1. ?????
  2. Standards from predecessor to IASB (IASC, for example)
  3. Interpretations issued by peripheral organization to IASB
A

IFRS standards

76
Q

3 Tiers of IASB Hierarchy

  1. IFRS standards

2 ????

  1. Interpretations issued by peripheral organization to IASB
A

Standards from predecessor to IASB (IASC, for example)

77
Q

3 Tiers of IASB Hierarchy

  1. IFRS standards
  2. Standards from predecessor to IASB (IASC, for example)
  3. ?????
A

Interpretations issued by peripheral organization to IASB

78
Q

What are the 3 Tiers of the IASB Hierarchy?

A
  1. IFRS standards
  2. Standards from predecessor to IASB (IASC, for example)
  3. Interpretations issued by peripheral organization to IASB
79
Q

What is the 1st tier of the IASB Hierarchy?

A

IFRS standards

80
Q

What is the 2nd tier of the IASB Hierarchy?

A

Standards from predecessor to IASB (IASC for example)

81
Q

What is the 3rd tier of the IASB Hierarchy?

A

Interpretations issued by peripheral organization to IASB

82
Q

What was the predecessor to the IASB?

A

IASC

83
Q

What was the predecessor to the IASB?

A

IASC

84
Q

How does FASB’s ASCs differs to IASB’s IFRS and its hierarchy?

A

No hierarchy with FASB, if it’s in the ASC it’s part of GAAP

If it’s not in the ASC it’s not part of GAAP, you don’t go looking at standards of FASB predecessors

85
Q

How many Board members does FASB have?

A

7 members

86
Q

How many Board members does IASB have compared to FASB?

A

Nearly double (FASB has 7)

87
Q

IASB’s 3 Tier Governance Structure

  1. IFRS Foundation Monitoring Board
  2. ????
  3. IASB
A

IFRS Foundation Trustees

88
Q

IASB’s 3 Tier Governance Structure

  1. ?????
  2. IFRS Foundation Trustees
  3. IASB
A

IFRS Foundation Monitoring Board

89
Q

IASB’s 3 Tier Governance Structure

  1. IFRS Foundation Monitoring Board
  2. IFRS Foundation Trustees
  3. ?????
A

IASB

90
Q

What are the 3 Tiers of IASB Governance Structure

A
  1. IFRS Foundation Monitoring Board
  2. IFRS Foundation Trustees
  3. IASB
91
Q

What is the 1st tier of iASB governance structure

A

IFRS Foundation Monitoring Board

92
Q

IFRS Foundation Monitoring Board is the first tier of the IASB Governance Structure - What do they do?

A

They oversee the IFRS Foundation trustees- the second tier

93
Q

IFRS Foundation Trustees is the 2nd tier of the IASB Governance Structure - What do they do?

A

Select the board members and provide oversight for IASB

94
Q

IASB is the 3rd tier of the IASB Governance Structure - What do they do?

A

Issue IFRS

95
Q

In the IASB Governance Structure - what 2 departments are to the left and right of IASB on the chart?

  1. ?????
  2. IFRS Interpretations Committee
A

IFRS Advisory Council

96
Q

In the IASB Governance Structure - what 2 departments are to the left and right of IASB on the chart?

  1. IFRS Advisory Council
  2. ?????
A

IFRS Interpretations Committee

97
Q

In the IASB Governance Structure - what 2 departments are to the left and right of IASB on the chart?

A
  1. IFRS Advisory Council

2. IFRS Interpretations Committee

98
Q

What does the IFRS advisory council do to assist IASB in IASB Governance Structure?

A

Provides advice to IASB about which projects to add ot agenda

99
Q

What does the IFRS Interpretations Committee do to assist IASB in IASB Governance Structure?

A

Look at different issues coming in international accounting

For example: they see 2 companies accounting the same transaction in different ways and don’t think it’s consistent with IFRS

They look at the existing IFRS and try to find a consensus on the way it should be accounted for so the IASB doesn’t have to get involved and issue a new IFRS

100
Q

FASB tiers of Governance Structure

  1. ????
  2. FASB
  3. ASC
A

FAF

101
Q

FASB tiers of Governance Structure

  1. FAF
  2. ????
  3. ASC
A

FASB

102
Q

FASB tiers of Governance Structure

  1. FAF
  2. FASB
  3. ????
A

ASC

103
Q

FASB tiers of Governance Structure

A
  1. FAF
  2. FASB
  3. ASC
104
Q

What does FAF stand for?

A

Financial Accounting Foundation

105
Q

The FAF is the 1st tier to FASB governance structure - What do they do?

A

Select the board members of FASB

106
Q

The FASB is the 2nd tier to FASB governance structure - What do they do?

A

Create ASC

107
Q

Whats the FASB counterpart to issuing IFRS like the IASB?

A

Issuing ASU - an accounting standards update

108
Q

What do ASUs do to ASCs

A

they amend them

109
Q

In the FASB governance structure - what are the 2 departments to the left and right of FASB

  1. ????
  2. Emerging Issues Task Force (EITF)
A

Financial Accounting Standards Advisory Committee (FASAC)

110
Q

In the FASB governance structure - what are the 2 departments to the left and right of FASB

  1. Financial Accounting Standards Advisory Committee (FASAC)
  2. ?????
A

Emerging Issues Task Force (EITF)

111
Q

In the FASB governance structure - what are the 2 departments to the left and right of FASB

A
  1. Financial Accounting Standards Advisory Committee (FASAC)
  2. Emerging Issues Task Force (EITF)
112
Q

What does the FASAC do to assist FASB in Governance Structure?

A

Provides advice to FASB about which projects to add to agenda

113
Q

What does the EITF do to assist FASB in Governance Structure?

A

Take current issues in account and see if it can be dealt with current ASC and reach a consensus so FASB doesn’t have to get involved

114
Q

What is FinCEN

A

Financial Crimes Enforcement Network

115
Q

Service Efforts and Accomplishments (SEA) helps bring ____ information to citizens to help with their assessment, program selection and implementation

A

performance results

116
Q

Things within the scope of the GASB standard setting mission

  • ??????
  • External financial reporting
  • Assisting users in assessing the level of service that can be provided by governmental entities
A

Conceptual Framework for accounting and reporting standards

117
Q

Things within the scope of the GASB standard setting mission

  • Conceptual Framework for accounting and reporting standards
  • ??????
  • Assisting users in assessing the level of service that can be provided by governmental entities
A

External financial reporting

118
Q

Things within the scope of the GASB standard setting mission

  • Conceptual Framework for accounting and reporting standards
  • External financial reporting
  • ??????
A

Assisting users in assessing the level of service that can be provided by governmental entities

119
Q

Things within the scope of the GASB standard setting mission

A
  • Conceptual Framework for accounting and reporting standards
  • External financial reporting
  • Assisting users in assessing the level of service that can be provided by governmental entities
120
Q

Does GASB establish the goals and objective of state and local governmental services?

A

No

121
Q

Who establishes the goals and objectives of state and local governmental services?

A

Management, elected officials governmental stakeholders,

122
Q

Under 1st time adoption of IFRS, an entity may elect to use fair value as deemed cost for….

A

Assets carried at cost (Ex: PPE)

123
Q

Objectives of Financial Reporting Stem from ….

A

The needs of external users of information

124
Q

Why are Note Disclosures considered essential for governmental financial reporting - according to GASB Concepts Statement No. 3

A

Notes add descriptions and detail that have a clear and demonstrable relationship to the financial statements

125
Q

GASB concept Statement No. 4 - Definition of Assets

A

Assets, per GASB Concept statements No 4 must provide service capacity and be controlled by the government

126
Q

GASB concept Statement No. 4 - Definition of Liabilities

A

Present obligations to sacrifice resources that the government has little or no discretion to avoid

127
Q

A full set of Financial Statements includes…

A

Statement of comprehensive income

Statement of changes of owners equity

Also the obvious 3 (balance, income, Cash Flow)

128
Q

Comprehensive income includes all changes in equity during a period except those resulting from ______ and ______

A

Investments by owners

Distributions to owners

129
Q

When Converting from Accrual Basis to Cash Basis Net Income - How is change in accounts payable treated?

A

Added to Accrual basis to get to cash basis

130
Q

When Converting from Accrual Basis to Cash Basis Net Income - Why is a decrease in A/P subtracted.

A

Because a decrease in a/p means the cash payments exceed the current periods accrual bais expenses.

131
Q

The SFAC objectives are designed to ….

A

Constitute a foundation for financial accounting standards.

132
Q

The SFACS do/are NOT…

  • ????
  • Enforceable under the Rules of Conduct of the Code of Professional Ethics
  • Considered authoritative pronouncements
A

Establish accounting standards and disclosure practices for particular items

133
Q

The SFACS do/are NOT…

  • Establish accounting standards and disclosure practices for particular items
  • ??????
  • Considered authoritative pronouncements
A

Enforceable under the Rules of Conduct of the Code of Professional Ethics

134
Q

The SFACS do/are NOT…

  • Establish accounting standards and disclosure practices for particular items
  • Enforceable under the Rules of Conduct of the Code of Professional Ethics
  • ?????
A

Considered authoritative pronouncements

135
Q

The SFACS do/are NOT…

A
  • Establish accounting standards and disclosure practices for particular items
  • Enforceable under the Rules of Conduct of the Code of Professional Ethics
  • Considered authoritative pronouncements
136
Q

____- Defines income as change in net resources other than from owner transactions

A

Financial Capital Maintenance Concept

137
Q

______ is the concept used in present financial statement and comprehensive income

A

Financial capital maintenance concept

138
Q

____ has less perspective standard layouts than ______ in that it doesn’t prescribe a standard layout, but includes a list of minimum items

A

IFRS

US GAAP

139
Q

What is the Date of Transition for a company adopting IFRS for the 1st time?

A

Earliest period for which comparative information is presented

140
Q

How is recognition defined?

A

The process of formally recording or incorporating an item in the financial statements

141
Q

What is the cost benefit constraint?

A

In determining the kind and amount of information to be provided in the financial statements, the cost of obtaining the information must be considered

142
Q

IASB Conceptual Framework addresses which of the following concepts of capital?

A

Financial and Physical

143
Q

FASB Process for Creating Standards

  1. ?????
  2. Hold Public Meetings
  3. Issue Exposure Draft.
  4. Comment Letters
  5. Another public meeting (maybe)
  6. Issue ASU (Maybe)
A

Add to agenda

144
Q

FASB Process for Creating Standards

  1. Add to agenda
  2. ???????
  3. Issue Exposure Draft.
  4. Comment Letters
  5. Another public meeting (maybe)
  6. Issue ASU (Maybe)
A

Hold Public Meetings

145
Q

FASB Process for Creating Standards

  1. Add to agenda
  2. Hold Public Meetings
  3. ??????
  4. Comment Letters
  5. Another public meeting (maybe)
  6. Issue ASU (Maybe)
A

Issue Exposure Draft.

146
Q

FASB Process for Creating Standards

  1. Add to agenda
  2. Hold Public Meetings
  3. Issue Exposure Draft.
  4. ???????
  5. Another public meeting (maybe)
  6. Issue ASU (Maybe)
A

Comment Letters

147
Q

FASB Process for Creating Standards

  1. Add to agenda
  2. Hold Public Meetings
  3. Issue Exposure Draft.
  4. Comment Letters
  5. ??????
  6. Issue ASU (Maybe)
A

Another public meeting (maybe)

148
Q

FASB Process for Creating Standards

  1. Add to agenda
  2. Hold Public Meetings
  3. Issue Exposure Draft.
  4. Comment Letters
  5. Another public meeting (maybe)
  6. ????
A

Issue ASU (Maybe)

149
Q

FASB Process for Creating Standards

A
  1. Add to agenda
  2. Hold Public Meetings
  3. Issue Exposure Draft.
  4. Comment Letters
  5. Another public meeting (maybe)
  6. Issue ASU (Maybe)
150
Q

Where should all the adjustments - from applying IFRS 1 - first time adaption of IFRS - be recognized

A

Directly min Retained Earnings or, if appropriate, in another category of equity

151
Q

What is the overriding principle of IFRS - First time adoption of IFRS

A

Full retrospective application of all IFRS Standards.

152
Q

According to GASB Concepts Statement No. 2, measures of service accomplishments focus on _______ and ______

A

Outputs and Outcomes

153
Q

According to the FASB conceptual framework, the objective of general purpose financial reporting is based on

A

The needs of the users of information

154
Q

Under IFRS, what is considered investment property

A

An asset held to earn rent or for capital appreciations (or both)

Part of a building held to earn rentals is considered investment property

155
Q

Accounting Treatment for impairment of long lived assets, good will and intangibles under GAAP and IFRS

  1. GW and intangible assets with indefinites lives to be reviewed at least annually for impairment and more frequently if impairment indicators are present
  2. Require that an asset found to be impaired be written down and an impairment loss recognized
  3. ????
A

Prohibit reversal of the impairment of goodwill

156
Q

Accounting Treatment for impairment of long lived assets, good will and intangibles under GAAP and IFRS

  1. ?????
  2. Require that an asset found to be impaired be written down and an impairment loss recognized
  3. Prohibit reversal of the impairment of goodwill
A

GW and intangible assets with indefinites lives to be reviewed at least annually for impairment and more frequently if impairment indicators are present

157
Q

Accounting Treatment for impairment of long lived assets, good will and intangibles under GAAP and IFRS

  1. GW and intangible assets with indefinites lives to be reviewed at least annually for impairment and more frequently if impairment indicators are present
  2. ?????
  3. Prohibit reversal of the impairment of goodwill
A

Require that an asset found to be impaired be written down and an impairment loss recognized

158
Q

The reversal of loss of long lived assets held and used is allowed under ____ but not under _____

A

IFRS

US GAAP

CPA Exam - FAR (8 decks)

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