Advanced Diploma Synoptic Flashcards
Sustainable development definition
Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.
Objects of sustainable development
Economic growth
Environmental protection
Social equality
Fundamental Principles
Professional behaviour
Professional competence and due care
Confidentiality
Integrity
Objectivity
Threats
Self-interest threats
Self-review threats
Familiarity threats
Intimidation threats
Advocacy threats
Result of absorption costing
Artificially inflated profit: The share of fixed production overheads that are attributed to unsold inventory are not recorded.
Use of marginal costing
Marginal costing is used for more accurate short term decision making.
Costing method for financial statements
Absorption costing must be used for financial statements
What does IAS2 say about LIFO?
It is not permitted to be used for financial statements
Where is goodwill added and removed from?
The capital account
Limited Liability Partnerships
File accounts with companies house
Doesn’t have the same tax advantages as a limited company
Each member is taxed as an individual
Can’t sell shares to attract outside investment
You may have a defence against a money laundering charge if you make:
An authorised disclosure to the relevant authority
Why must accountants uphold sustainability?
Because ensuring sustainability is in the public interest and accountants have a responsibility to work in the public interest.
Two key assumptions that underlie the preparation of financial statements:
Accrual basis
Going concern
Fundamental qualitative characteristics of financial statements:
Relevance
Faithful Representation
Profit/loss on ETB
Adjust the TB values by the adjustments.
After doing this, the debits and credits won’t balance anymore. The amount it doesn’t balance by will be the same for the SPL as for the SFP. This is the profit or loss.
A credit is a profit and a debit is a loss.
