a) Describe the "reliability" characteristic of financial information. b) Chairman's statement is not a compulsory disclosure. Discuss the reason for most of the annual reports include it as an important qualitative information? c) With examples, explain the five (5) components of the accounting equation that made up the statement of financial position (balance sheet), which is one part of several financial statement's components. d) Discuss how auditor's opinion helps the shareholders in their decision-making process. TE

a) Describe the "reliability" characteristic of financial information. b) Chairman's statement is not a compulsory disclosure. Discuss the reason for most of the annual reports include it as an important qualitative information? c) With examples, explain the five (5) components of the accounting equation that made up the statement of financial position (balance sheet), which is one part of several financial statement's components. d) Discuss how auditor's opinion helps the shareholders in their decision-making process. TE

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter6: Accounting Quality

Section: Chapter Questions

Problem 8QE

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1. How does the Accounting cycle facilitate financial statement reporting? how are accounting managers involved in each step. please elaborate. 2. what are the two determing factors influencing the choice of GAAP and IFRS financial reporting standard?
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Which of the following accounting concepts do accountantsand auditors assess by using financial analyses?a. Time period. c. Full disclosure.b. Separate entity. d. Going-concern assumption.
Listed below are several types of pronouncements that the FASB issues. Following the lis is a series of descriptive statements. a. Statements of Financial Accounting Standards b. Interpretations c. Technical Bulletins d. Statements of Financial Accounting Concepts e. Guide for Imprementation _____ Establishes a theoretical foundation upon which to base fanancial accounting and reporting standards. _____ Provides clarification of conflicting or unclear issues relating to previously issued pronouncements. _____ FASB Q's and A's. _____ Establishes generally accepted accounting principles. _____ Provides guidance on accounting and reporting problems related to an underlying standard.
Generally accepted accounting principles play an important role in financial reporting.a. What is meant by the phrase generally accepted accounting principles?b. What are the major sources of these principles?c. Is there a single comprehensive list of generally accepted accounting principles? Explain. d. What types of accounting reports are prepared in conformity with generally accepted account-ing principles?
a.How does the Accounting cycle facilitate financial statement reporting? how are accounting managers involved in each step. please elaborate .b.what are the two determing factors influencing the choice of GAAP and IFRS financial reporting standard?
The following is a list of qualitative characteristics of useful accounting information identified in FASB's and IASB's Statement of Financial Accounting Concepts No. 8 and statements describing the qualities. A. Comparability B. Decision usefulness C. Relevance D. Faithful representation E. Predictive value F. Confirmatory value G. Verifiability H. Neutrality I. Free from error J. Consistency K. Materiality L. Timeliness M. Understandability N. Completeness Required: Select the appropriate letter identifying each quality on the statement describing the quality. 1. Different knowledgeable and independent observers can reach consensus that a particular representation is faithful. 2. Making information available to decision makers before it loses its capacity to influence decisions. 3. Capacity to make a difference in a decision, enabling users to predict future outcomes and/or confirm prior expectations. 4. Overall objective of financial information.
Financial statements may be defined as a structured financial representation of the events that have an impact on an entity and the transactions undertaken by it during the financial year to which these statements relate. Financial records will be most beneficial when we keep accurate books of accounts. 1. Explain what you would need to keep accurate books of accounts. Give examples in reference to the institution you are familiar with and list the steps that you expect a financial transaction to go through. 2. Record the following transactions in the appropriate ledger accounts and prepare a Trail Balance as at 30th June 2022. June 2022 1st : 3rd : 4th 5th 7th 9th 10th : 11th : 12th : 14th : 15th : 16th : 17th : 18th : 19th : 20th : : : : : Nchimunya started business with a capital of K 80,000 Bought goods from Bwalya on credit K 20,000 Sold goods to Twaambo K 25,000 Cash purchases K25,000 Cash sales K 15,000 Goods retuned to Bwalya K 2,000 Bought furniture for K15, 000 Cash paid to…
(a) "Accounting is irelevant in decision making because the information it provides relates only to the past. Evaluate this remark. Click or tap here to enter text. (b) Describe three ways you would identify if a financial statement is a special purpose financial statement or a general purpose financial statement. There are various differet charactristics of special purpose financial statement and general purpose financial statement. We can easily identify them by those characteristics. Some of major character which helps us to identify either it is general purpose financial structure or it is special purpose financial statement are coined below, 1. (c) Users of accounting information can be identified as internal and external users. List two of users in each category and the type of information they require. Click or tap here to enter text. (d) You have decided that now is the time to buy a new laptop for your MPA studies. List the factors that are important in choosing a new laptop.…
Discuss the four basic Assumptions that underline the financial Accounting Structures with example. b) Match the qualitative characteristics below with the following statements. I. Relevance VI. Comparability II.Faithful representation VII.Completeness III. Predictive value VIII.Neutrality IV.Confirmatory value IX.Timeliness V. Free from error X. Understandability (i) Quality of information that permits users to identify similarities in and differences between two sets of economic phenomena. (ii) Having information available to users before it loses its capacity to influence decisions. (iii) Information about an economic phenomenon that has value as an input to the processes used by capital providers to form their own expectations about the future.
in the conceptual framework for financial reporting what provides "the why" —the goals and purposes of accounting 1. elements of the financial statements 2. Object is a financial reporting 3. measurement and recognition concepts such as assumptions and principles 4. qualitative characteristics of accounting information
An enhancing qualitative characteristics of financial accounting information is that: Information must be decision-useful to all potential users of financial reporting. General-purpose financial reporting is the primary source of information for users. Users need reasonable knowledge of business and financial accounting matters to understand the information contained in the financial statements. All of the choices are correct.