Chapter 1 Flashcards
What is FAF?
Financial Accounting Foundation (FAF), It oversees the following bodies involved in the establishment of U.S. GAAP for nongovernmental entities
What are ASUs?
Accounting Standards Updates (ASUs)
When an ASU has been incorporated into the FASB’s…..
ASC, it has the status of U.S. GAAP.
IFRS are more or less detailed than FASB?
Less
What is FASAB
The FASAB establishes accounting principles for the federal government
Primary users of financial information are
current or potential investors and creditors
NFP’s report
net assets rather than equity (Assets – Liabilities).
Define Economic-entity assumption
The reporting (accounting) entity is separately identified for the purpose of economic and financial accountability
Define Going-concern assumption
Unless evidence indicates otherwise, every business is assumed to be a going concern that operates indefinitely
Define Monetary-unit assumption
Accounting records are kept in terms of money
Define Periodicity assumption
Economic activity can be divided into distinct time periods
Define Conservatism constraint
When alternative accounting methods are appropriate, the one with the less favorable effect on net income and total assets is preferable
List the fundamental qualitative characteristics
Relevance * Predictive value * Confirmatory value * Material Faithful representation * Completeness * Neutrality * Free from error
List the enhancing qualitative characteristics
Enhancing
- Compatibility
- Verifibile
- Timeliness
- Understandibility
List the recognition criteria
- Definition
- Measurable
- Relevant
- Reliable
When should revenue be recongized
- realizable
2. earned
Define Expected present value
the sum of the present values of estimated cash flows discounted using the same interest rate and weighted according to their probabilities.
Regulation S-X
applies to the reporting of interim and annual financial statements, including notes and schedules.
Regulation S-K
provides disclosure standards, including many that are nonfinancial.
Regulation S-B
applies to small business issuers and nonaccelerated filers.
Regulation S-T
governs the types of documents the SEC requires to be filed electronically.
When must form 10K be filed
(a) 60 days of the last day of the fiscal year by large accelerated filers ($700 million or more in publicly held stocks, i.e., shares held by the public and not insiders), (b) 75 days by accelerated filers ($75 million to $700 million), and (c) 90 days by nonaccelerated filers (less than $75 million).
When must form 10Q be filed
(a) 40 days of the last day of the first three fiscal quarters by large accelerated filers ($700 million or more in publicly held stocks) and accelerated filers ($75 million to $700 million) and (b) 45 days by nonaccelerated filers (less than $75 million).
When must form 8K be filled
It must be filed within 4 business days after the material event occurs.
