Balance Sheet and Disclosures Overview

Question 1

What note to the FS is required by both US GAAP and IFRS?

Answer 1

descriptions of all significant policies includes as an integral part of the FS (Summary of Significant Accounting Policies)

Question 2

What is often included in the Summary of Significant Accounting Policies?

Answer 2

Identification and description of:

1. Measurement bases used
2. Accounting principles and methods
3. Criteria
4. Policies
5. Pricing

Question 3

Which financial reporting FW requires the disclosure of judgments made by mgmt.?

Answer 3

IFRS

Question 4

What is disclosed in the remaining notes to the FS?

Answer 4

All other information relevant to decision makers

1. Changes in s/h’s equity
2. Required marketable securities disclosures
3. Contingency losses
4. Contractual obligations (off B/S financing/operating leases)
5. Pension plan description
6. Post B/S disclosures (discontinued segment, correction of error)

Question 5

What does related parties consist of?

Answer 5

1. Affiliates
2. Equity method investments
3. Parent/subsidiaries
4. Trusts for benefit of employees
5. Mgmt of entity/immediate family members
6. Owners of more than 10% of voting interest & immediate family

Question 6

US GAAP related party disclosure requirements

Answer 6

Disclosure of material related party transactions

Includes:

• Nature
• Description
• Dollar amounts
• Amounts due to or from
• Name

Question 7

Which financial reporting FW requires the disclosure of allowance for bad debts, bad debt expense, or write-offs related to related parties?

Answer 7

IFRS

Question 8

What is required to be included in the disclosure of risks and uncertainties under US GAAP?

Answer 8

1. Nature of operations
2. Use of estimates in preparation of FS
3. Certain significant estimates
4. Current vulnerability due to certain concentrations

Question 9

Vulnerability due to concentrations

Answer 9

When entity is exposed to risk of loss that could be mitigated through diversification

Question 10

What is the purpose of info presented in notes to the FS?

Answer 10

To provide disclosures required by GAAP

Question 11

What types of related party transactions would not require disclosures?

Answer 11

All transactions in the ordinary course of business

Question 12

Under IFRS, what related party transactions are required to be disclosed?

Answer 12

Loans to officers and key mgmt compensation