F-1 EXTRAORDINARY ITEMS Flashcards

1
Q

Define extraordinary items.

FAR 1-21

A
  • Material in nature
  • Of a character significantly different from the typical or customary business activities (unusual)
  • Not expected to recur in the foreseeable future (infrequent)
  • Not normally considered in evaluating the ordinary operating results of an enterprise.

Key words: Usual and infrequent

Remember: Extraordinary items are recognized under U.S. GAAP but not IFRS.

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2
Q

Q: List some examples of extraordinary items.

FAR 1-22

A
  • The abandonment of, or damage to, a plant due to an infrequent earthquake or an infrequent flood.
  • An expropriation of a plant by the government.
  • A prohibition of a product line by a newly enacted law or regulation.
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