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Chapter 1 Flashcards

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1
Q

generate general purpose financial statements that provide info, about economic entities, that is used as basis for the formulation of economic decisions

A

Purpose of Accounting Process

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2
Q

communication of financial statements and other financial info

A

Financial Reporting

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3
Q

purpose of financial reporting

A

To provide useful financial info to stakeholders

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4
Q

active owners and managers

A

Internal Users

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5
Q

users that have ready access to specific types of accounting information

A

Internal Users

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6
Q

users other than the management of the entity

A

External Users

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7
Q

users that do not have ready access to financial reports and rely heavily on negotiations and regulations

A

External Users

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8
Q

primary users of financial reporting are the external users

A

True

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9
Q

product of financial accounting

A

Financial Statements

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10
Q

general-purpose reports provided to external users

A

Financial Statements

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11
Q

assess the ability to pay loans and the interest attached to it

A

Present and potential creditors

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12
Q

whether the cost of goods and services will be paid when due

A

Suppliers of goods and services

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13
Q

continuation of the enterprise as a major customer

A

Suppliers of goods and services

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14
Q

concerned with the financial status of the enterprise

A

Employees

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15
Q

they check the ability to provide remuneration, retirement benefits and employment opportunities of companies

A

Employees

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16
Q

they are concerned in the continuance of an enterprise

A

Customers

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17
Q

concerned if they have long-term involvement with are their supplier

A

Customers

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18
Q

concerned with the interest of public investors and other parties dealing with it

A

Government Regulation

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19
Q

they check if it complied with the prescribed rules and regulations, taxation policies and collection

A

Government Regulation

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20
Q

they set basis for national income and similar statistics

A

Government Regulation

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21
Q

concerned with the trends and range of business entities’ economic activities

A

Public

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22
Q

users with direct interest in the financial information

A

Direct Users

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23
Q

tool to protect their own interest in the enterprise

A

Direct Users

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24
Q

they provide advice and protect the interest of a direct user

A

Indirect Users

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25
they protect investors and public
Regulatory Agency
26
they protect employees
Labor Unions
27
they protect customers, lenders and suppliers
Financial and Legal Consultant
28
unit of measure used in communication accounting information
Monetary Unit
29
a unit that has a personality diff from the personality of its owners, members and employees
Reporting Entity/ Accounting Entity
30
concept that separates the personality of the enterprise from that of its owners and other stakeholder
Accounting Entity Concept/ Business Entity Concept
31
capable of controlling its own economic resources and incurring economic obligations
Accounting Entity
32
Branches of Accounting
Financial, Management, Cost, Tax, Government
33
broadest branch of accounting that is concerned with the needs of external users
Financial Accounting
34
common info needs of external users
Profitability, Liquidity and Stability
35
Financial accounting should conform to the accounting standards
True
36
2 main purpose of accounting standard
Relevance and Reliability
37
it serves to the needs of internal users (short-term and long-term plans and routine and major economic decisions)
Management Accounting
38
information is not structured and does not necessarily need to conform to accounting standards
Management Accounting
39
measurement and recognition of cost of services provided/products manufactured
Cost Accounting
40
deals with the computation of taxes and preparation of tax returns submitted to a taxing authority
Tax Accounting
41
receipt and disposition of government funds and property
Government Accounting
42
system adapted by government units and some government agencies
Government Accounting
43
one phase of accounting which is the recording phase
Bookkeeping
44
other phases of accounting
classifying, summarizing, communicating and interpreting
45
independent examination of financial statement by a CPA
Auditing
46
it is developed internally and is the representation of the company's management
Financial Statements
47
1973; it developed a set of uniform global accounting standards
Internal Accounting Standards Committee (IASB)
48
incomparability is not an issue
International Accounting Standard (IAS)
49
2001; it is under the umbrella of IFRS Foundation
International Accounting Standards Board (IASB)
50
not for profit, public interest organization
International Financial Reporting Standards (IFRS)
51
develop a single set of high-quality, understandable, enforceable and globally accepted accounting standards
IFRS
52
standards that originated from the works of the IAS Committee and later improved/revised by the IASB
IAS
53
standards that originated from the works of the IASB
IFRS
54
IFRS include the following _____
ISIS
55
I of ISIS
Interpretation of IFRIC
56
IFRIC
International Financial Reporting Interpretations Committee
57
S of ISIS
Specific IFRS
58
second I of ISIS
International Accounting Standards
59
second S of ISIS
SIC
60
SIC
Standing Interpretations Committee
61
Overall objective of IASB
TAE
62
TAE
Transparency, Accountability and Efficiency
63
Overall objective of IASB
to communicate financial info that achieves TAE to financial markets around the world
64
enhancing the international comparability and quality of information
Transparency
65
reducing info gap between the investors and people
Accountability
66
another major sector of users of financial information
Regulators
67
helping investors identify opportunities and risks and improves capital allocation
Efficiency
68
Primary function of the IFRS Foundation
govern and oversee the activities of its standard-setting body (IASB)
69
IASB due process
APDESI
70
APDESI
Agenda, Planning the project, Discussion Paper, Exposure Draft, Standard, Issuance
71
may effectivity date and may date of issuance (ahead/equal to that of the ED)
Issuance
72
issue item that tackles about the relevance and reliability of the info
Agenda
73
members of staff from other accounting standard-setters; maybe jointly or alone
Working Group
74
it is not mandatory; comprehensive overview of the issue; tackles possible approaches in addressing the issue
Discussion Paper
75
preliminary views of its author/IASB and an invitation to comment
Discussion Paper
76
carried by another standard-setter; it only requires the simple majority vote of the IASB members
Research Project
77
carried out by the IASB
Active Agenda
78
main vehicle to consult the interested public
Exposure Draft
79
a proposed standard/proposed amendment to a standard
Exposure Draft
80
the comment period of the exposure draft
120 Days
81
the number of days for the IFRIC interpretations in the exposure draft
60 Days
82
if necessary a second draft may be written
True
83
sent to selected parties for review
Pre-ballot IFRS
84
posted on IASB's website (limited access = 10 days; after then its freely available online)
Near Final Draft
85
circularizing the near final reporting standard to the IASB members
Balloting
86
it requires individual final review and approval of the draft
Balloting
87
IFRS are principle-based rather than procedure-based
True
88
organized to interpret specific issues when the standards do not include specific authoritative guidance
IFRIC
89
IFRIC consists of how many members
14 voting members
90
the year when BoA was formed and start of formal accounting in the Philippines
1923
91
IFRIC members should act independently and does not represent any org or associations
True
92
accredited professional org of CPA in the Philippines
Philippine Institute of CPA (PICPA)
93
formalized the standard setting process in the Phil
Accounting Standard Council (ASC)
94
year when ASC when formed
November 18, 1981
95
accounting standard developed by ASC
Statements of Financial Accounting Standards (SFAS)
96
they established and improved GAAP in the Phil
ASC
97
how many members does FRSC have?
15 members (1 chairman and 14 members)
98
how many members does ASC have?
8 members
99
body that regulates the practice of accountancy in the Philippines
Board of Accountancy (BoA)
100
Implementing Rules and Regulations of the Phil Accountancy Act
R.A. 9298
101
provide the council assistance in establishing and improving financial reporting standards in the Phil
Philippine Interpretations Committee (PIC)
102
when was PIC formed?
November 2006
103
they replace and take over the functions of ASC
Financial Reporting Standard Council (FRSC)
104
when was FRSC formed?
2006
105
PIC guidelines on PFRS
SPaPi
106
S of SPaPi
Specific PFRS adopted from IFRS
107
Pa of SPaPi
Philippine Accounting Standard adopted from IAS
108
Pi of SPaPi
Philippine Interpretations (IFRIC and SIC), interpretations of PIC
109
PFRS due process
CFICAP
110
consideration of pronouncement of IASB, formation of task force, issue exposure draft, consideration of comment letter to IASB, approval by a majority (at least 51% of FRSC), publish the standard to Official Gazette/newspaper of general circulation
CFICAP
111
commentary period of exposure drafts in PFRS due process
60 days but not less then 30 days

CFAS (4 decks)

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