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Flashcards in Accounting standards and conceptual frameworks Deck (18):
1

Who has the legal authority to establish U.S. generally accepted accounting principles?

Securities and Exchanges Commission

2

How was the SEC established?

Securities Exchange Act of 1934

3

What became the single source of authoritative nongovernmental U.S. GAAP.

FASB Accounting Standards Codification

4

What does it mean when accounting and financial reporting practives not included in the Codification?

Not GAAP

5

The Codification is composed of the following literature that had been issued by various standard setters?

Financial Accounting Standards Board, Emerging Issues Task Force, Derivative Implementation Group Issues, Accounting Principles Board Opinions, Accounting Research Bulletins, Accounting Interpretations, and AICPA

6

Are Accounting Standards Updates authoritative literature?

No

7

What is the purpose of IASB?

To develop a single set of high-quality, global accounting standards

8

What committee provides guidance on newly identified financial reporting issues not addressed in the IFRSs and assists the IASB in achieving international convergence of accounting standards?

International Financial Reporting Interpretations Committee

9

What standards did the International Accounting Standards Board adopt when it was created?

International Accounting Standards

10

What is the goal of the convergence project?

A single set of high-quality, international accounting standards that companies can use for both domestic and cross-border financial reporting

11

Are the Statements of Financial Accounting Concepts GAAP?

No

12

What are the 2 fundamental qualitative characteristics of financial information?

Relevance and faithful representation

13

What makes financial information relevant?

If it is capable of making a difference in the decisions made by users

14

What are the 3 factors in relevance?

Predictive value, confirming value, and materiality

15

What are the 3 characteristics of faithful representation?

Completeness, neutrality, and freedom from error

16

What is a neutral depiction of financial information free from?

Bias

17

What are the characteristics that enhance the usefulness of information that is relevant and faithfully represented?

Comparability, verifiability, timeliness, and understandability

18

The IASB Framework for the Preparation and Presentation of Financial Statements outlines only two fundamental assumptions?

Accrual basis accounting and going concern