Deck 1 Flashcards

(29 cards)

1
Q

Change in accounting estimate is reported:

A

Prospectively - component of income from continuing operations

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2
Q

Change in accounting principle is reported:

A

Retrospectively - restating all prior periods presented.

Cumulative effect is an adjustment to beginning retained earnings if NONCOMPARATIVE financial statements aren’t presented or if financial statements don’t go back that far - change earliest presented.

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3
Q

Correction of an error is reported:

A

Prior period adjustment to retained earnings

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4
Q

Change in accounting principle that is inseparable from effect of a change in accounting estimate is reported:

A

Prospectively - component of income from continuing operations

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5
Q

Change from cash basis to accrual basis is reported as:

A

Correction of an error: prior period adjustment

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6
Q

Prior period adjustments to retained earnings are presented:

A

Net of tax

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7
Q

Changes in entities is reported:

A

Retrospectively - restate comparative financial statements for prior period adjustments

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8
Q

Change in depreciation method is

A

A change in BOTH method and estimate, but reported as a change in estimate - prospective

New method used as of beginning of year and start with current book value of asset

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9
Q

IFRS change in principle reporting requirements

A

3 balance sheets - end of current, end of prior, beginning of prior

2 of other statements - end of current, end of prior

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10
Q

If it can’t be determined if a change was in estimate or principle, change is considered:

A

A change in estimate and accounted for prospectively

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11
Q

Change in reporting entity is treated:

A

Retrospectively, including note disclosures, and application to all prior financials presented

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12
Q

IFRS disclosure requirements for material error correction

A

Amount of correction at beginning of earliest period presented

Nature of error

Impact of the correction on basic and diluted earnings per share for reach period presented

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13
Q

Cumulative effect of change in accounting principle equals:

A

Difference between retained earnings at the beginning of the period of the change and what retained earnings would have been if the change was applied to all prior periods, assuming comparative financials statements are not presented

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14
Q

Cumulative effect of changing from lifo to weighted average is treated:

A

Retrospectively - all data is available

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15
Q

Cumulative effect of changing from weighted average to lifo is reported:

A

Prospectively - data on historical LIFO layers not available - impracticable to calculate cumulative effect.

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16
Q

Minimum reporting requirements for first IFRS financial statements

A

Three statements of financial position (balance sheets)
Two statements of comprehensive income
Two separate income statements
Two statements of cash flows
Two statements of changes in equity
Related notes, including comparative information

17
Q

What is the definition of comprehensive income?

A

Changes in equity of a business during a period from transactions and other events and circumstances from non-owner sources.

18
Q

Other comprehensive income includes:

A

Changes in funded status of a pension plan

Unrealized gains and losses on available for sale debt securities

Foreign currency items

Effective portion of cash flow hedges

19
Q

Where is AOCI reported?

A

As a component of stockholders equity on the balance sheet

20
Q

A held to maturity debt security is reclassified as available for sale

A

Unrealized holding gains and losses reported as OCI

21
Q

An available for sale debt security is reclassified as held to maturity

A

Moves out of OCI

22
Q

Unrealized gains and losses on available for sale debt securities are reported:

A

As a part of OCI

23
Q

Comprehensive is presented

A

Either on the face of a combined “statement of income and comprehensive income” statement as a separate section below net income, or in a separate “statement of comprehensive income”

24
Q

Reclassification adjustments

A

Move other comprehensive income items from accumulated other comprehensive income to the income statement

25
Accumulated other comprehensive income
Component of equity that includes the total of OCI for the current period and all previous periods
26
OCI and net income are closed to
The balance sheet. OCI closed to AOCI Net income closed to retained earnings
27
Purpose of comprehensive income
Summarizing all changes in equity from nonowner sources
28
What is PUFER
``` Pension adjustments Unrealized holding gains and losses on AFS debt securities Foreign currency items Effective portion of cash flow hedges Revaluation surplus (IFRS) ```
29
Prior service cost is a debit or credit to OCI?
Debit - prior service costs are an expense of a pension plan