Reporting Topics Flashcards
Purchasing Power Gains and Losses
Purchasing power losses result from holding monetary assets during a period of inflation because the fixed amount of money will purchase fewer goods and services following a period of inflation. The holding of nonmonetary items during a period of changing prices does not give rise to purchasing power gains or losses
Form 8 - K
filed to report the material events such as Memorandum & Associations, changes in directors or CEO, other major changes in operations or status, changes in auditors, etc. The Form 8-K is required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock.
The following are required to be reported to the SEC via Form 8-K:
• The creation of an obligation under an off-balance sheet arrangement of a registrant.
• The unregistered sale of equity securities.
• A change in a registrant’s certifying accountant.
Form 10 -Q
filed by the issuers quarterly that contains the unaudited Financial Statements.
Large Accelerated Filer
form is to be filed within 40 days of the end of the financial quarter.
Small Reporting Company
companies with less than $75 million in public equity float
If - Converted Method
Dilutive convertible securities are included in EPS computations under the if-converted method. Under that method, the security is assumed to have been converted at the beginning of the earliest period reported (or at time of issuance, if later).
Unusual Items in Interim Reporting
included in determining interim period income, but should be excluded in determining the full year effective income tax rate.
Reporting of Major Corporate Events
mandated to be reported to the SEC using the Form 8-K within 4 business days of the occurrence of the event.
Staff Accounting Bulletins
intended to achieve dissemination of administrative interpretations and practices of the SEC staff in reviewing financial information in SEC filings. The bulletins are not rules or interpretations of the Commission, nor have they been officially approved.
Emerging Issues Task Force
assist the FASB and its staff in the identification of accounting issues and implementation problems on a timely basis.
Form 10 - Q Financial Statements
In addition to the most recent quarter end balance sheet, a company is required to present the balance sheet for the end of the preceding fiscal year on the Form 10-Q..
Non - Accelerated Filers
have less than $75 million of average annual cash flow) have 90 days after the end of the fiscal year to file the Form 10-K
Large - Accelerated Filers
Large companies with an average annual cash flow of more than $700 million must file their 10-K within 60 days after their fiscal year ends.
Functional Currency
The functional currency of a foreign entity may be its local currency, the U.S. dollar, or another foreign currency. Where a foreign operation is relatively self-contained and integrated within one country, the entity’s functional currency will be the local currency. Where the foreign operation is, in essence, an extension of the parent’s U.S. operations, the functional currency will be the U.S. dollar.
Remeasurement
A foreign entity may keep its books in the local currency, yet have another foreign currency as functional currency; in which case remeasurement of the recording currency statements into functional currency will be required.
Financial Reporting Releases
may require an additional disclosure or define accounting to be followed by issuers. The accounting principles are set forth by the SEC in FRRs that are codified in the FRP.
Form 10 - Q
must be filed for each of the first three fiscal quarters of the company’s fiscal year.
Non - Accelerated Filers
have a public float of less than $75 million.
Accelerated Filers
have a public float of at least $75 million but less than $700 million.
Large Accelerated Filers
must file the Form 10-Q with the SEC within 40 days after the end of the company’s fiscal year. Large accelerated filers are issuers that have a public float of $700 million or more.
Regulation S - X
the principle accounting regulation of the SEC, governing the annual report. All financial statements presented in annual reports must conform to the S-X accounting and disclosure rules.
Regulation S - T
the cornerstone of the EDGAR rules, prescribing requirements for electronic filing and the pro¬cedures for making such filings.
Form 10 - Q
The quarterly results of operations and financial condition of a registrant
Retroactive Recognition in Earnings per Share
Stock dividends, stock splits, and reverse splits consummated after the close of the period but before completion of the financial report
XBRL
makes automation of data lot easier and makes data more accessible and less time consuming for users and the time saved can be diverted to comparability and analysis.
However, XBRL has no effect on security of data. As XBRL just makes data readable by machine.
Interim Period Inventory Losses
Recoveries of these losses in subsequent periods should be recognized as gains, but only to the extent of losses recognized in previous interim periods of the same fiscal year.
Categories of Potentially Dilutive Securities
include (1) con¬vertible securities where the if-converted method is used, (2) options, warrants, and their equivalents where the treasury stock method is used, and (3) contingently issuable shares.
Earnings per Share
the amount of earnings attributable to each share of common stock.
EPS Presentation
Publicly-held companies required to present basic EPS and dilutive EPS on:
Face of the statement of income for:
1. Income from continuing operations
2. Net income.
Either the face of statement of income or in notes to the financial statements for:
1. Discontinued operations.
Form 10 - K
annual report that gives a comprehensive summary of a public company’s performance.
Filer Categories
There are three categories of filers: (1) non-accelerated filers, (2) accelerated filers, and (3) large accelerated filers
Non - Accelerated Filing Time
within 90 days after the end of the company’s fiscal year.
Accelerated Filing Time
within 75 days after the end of the company’s fiscal year.
Large Accelerated Filing Time
within 60 days after the end of the company’s fiscal year.
Preferred Dividend Treatment
deducted from the net income or added to the net loss regardless of the fact it’s declared or not.
Current Cost / Constant Dollar
include adjustments for both specific price changes and general price-level changes.
Historical Cost / Nominal Dollar
the generally accepted method of accounting based on measures of historical prices without restatement.
Current Cost / Nominal Dollar
method of accounting in which adjustments for specific price changes are made but not for general price-level changes.
Historical Cost / Constant Dollar
method of accounting in which adjustments are not made for specific price changes, but are made for general price-level changes.
Statement of Financial Condition
When personal financial statements are prepared, a presentation of financial data that is intended to communicate a person’s or family’s economic resources or obligations on a specific date
Multiple Bank Accounts with Multiple Banks
the net balance of one bank might be positive and the net balance of the other bank might be negative. Then the company would reflect the bank account with positive balance as cash and the negative cash balance of the other bank as a liability.
Monetary Assets
money or a claim to receive a sum of money, the amount of which is fixed or determinable without reference to future prices of specific goods or services.
Restricted Cash
Cash that is restricted as to withdrawal or use for other than current operations, designated for expenditure in the acquisition or construction of noncurrent assets, or segregated for the liquidation of long-term debts should be excluded from current assets.
