Risks and Uncertainties

Question 1

Are disclosures about risks and uncertainties stemming from general macro-economic factors required?

Answer 1

No

Question 2

What an aspect of a firms operations necessitating disclosure of risks and uncertainties

Answer 2

Principal Markets
Products and services
Geographical location

Question 3

Under what conditions is disclosure about risks and uncertainty pertaining to concentrations required

Answer 3

when the event is reasonably possible. The event is not required to be probable

Question 4

Are the effect of changes in government regulations a source of risk and uncertainty for which disclosures are required by GAAP?

Answer 4

Yes

Question 5

Which of the following is not a source of risk and uncertainty for which disclosures are required by GAAP?

A. Nature of a firm’s operations.
B. Effect of changes in government regulations.
C. Use of estimates in financial statements.
D. Vulnerability to significant concentrations.

Answer 5

B. Effect of changes in government regulations. This is not noted in the applicable accounting standard.

Question 6

Is revenue one of the concentrations about which disclosures are required for risk and uncertainty?

Answer 6

Yes

Question 7

What information about estimates is not required to be disclosed regarding risk and uncertainty?

Answer 7

The old and new estimate in quantitative terms

Question 8

What information about esitmates is required to be disclosed regarding risk and uncertainty?

Answer 8

That estimates involve assumptions about future events, possible material financial statement effects of estimate changes and that estimates are required in preparing financial statements.