F2 - Financial Reporting and Disclosures

Question 1

Going Concern period

Answer 1

Not to exceed one year pas the date the “FS are issued”

Question 2

IFRS: Going Concern

Answer 2

Doesn’t provide guidance on liquidation accounting

Question 3

Liquidation Accounting: Valuation of Assets

Answer 3

Asset may increase in value on the balance sheet: measured and presented at expected cash proceeds from liquidation

Question 4

Sub Events Disclosure

Answer 4

Footnote disclosure is only required for losses that are reasonably possible

Question 5

FV measurement Inputs

Answer 5

Level 1: quoted prices in the market of “identical” assets/liabilities “most reliable”

Level 2: quoted prices in the market for “similar” assets/liabilities

Level 3: Management assumptions (only used when 1&2 aren’t available)

Question 6

Picking FV markets

Answer 6

Pick the one with the best “net price” (net value after transactions costs)

Question 7

Reportable Segments:

Answer 7

Segments that make up at least 10% of total revenues.

Question 8

Sales Disclosed for Segments:

Answer 8

Sales to 3rd parties and intercompany sales are reported separately

Question 9

What is considered a major customer?

Answer 9

Customer making more than 10% of total revenues/profits/liabilities/assets, internal and external

Question 10

When losses are involved in reporting segments:

Answer 10

10% of the total of profitable segments. Than take the greater of the absolute value of the income/loss for each segment. Greater = reportable

Question 11

IFRS segments:

Answer 11

Don’t report: Cash Flow

Question 12

Quarterly reporting:

Answer 12

If anything is to benefit multiple quarters, allocate that benefit/expense evenly to the quarters affected

Question 13

Regulation S-X

Answer 13

Financials filled with SEC should include a minimum of 2 BS

Question 14

Accelerated filers have a maximum of how long from the BS date to file their 10k? 10Q?

Answer 14

75 days and 40 (large), 45 (smaller)

Question 15

XBRL

Answer 15

Require all financials/schedules to be filled. No MD&A or things of that sort

Question 16

When should an “unusual/infrequent” occurring item be recognized for quarterly reporting?

Answer 16

Entire amount in period incurred

Question 17

Property tax quarterly allocation

Answer 17

Allocate to every quarter benefited (typically all of them)

Question 18

Income tax-basis financials are different why?

Answer 18

-Recognize certain revenues and expenses in different reporting periods.

Question 19

Note on Income-tax basis financials

Answer 19

-Nondeductible portion of expenses are still shown in expense category

Question 20

Cash accounting recognition

Answer 20

Revenue recognized and expense recognized when cash is paid or cash it paid out

Question 21

Cash basis revenue to accrual basis revenue

Answer 21

Cash basis revenue
\+Ending A/R
-Beg A/R 
\+Ending Unearned Revenue
-Beg Unearned Revenue

Question 22

Cash to accrual rules:

Answer 22

Add:
 increases in current assets
 decreases in current liabs
Subtract:
  decreases in current assets
  increases in current liabs

Question 23

Common modification to cash basis FS

Answer 23

Capitalizing Inventory

Question 24

A/R Turnover =

Answer 24

Net Sales/Avrg. Receivables

Also..

Avrg. Receivable x A/R turnover = Net sales

Question 25

Total Asset Turnover =

Answer 25

Net sales/Avrg. Total Assets

or

Avrg Total assets = Net Sales/Total Asset Turnover