Intermediate Accounting (2nd Edition)
2nd Edition
ISBN: 9780134730370
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Chapter 1, Problem 1.3E
Convergence of Accounting Standards, IFRS Vikram Patel, one of your friends from high school who is a finance major, is surprised that you are learning about international accounting. Explain why it is important for an accountant in the United States to learn International Financial Reporting Standards (IFRS).
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Based on your understanding of a system theory, accounting theory, and International Financial Reporting Standards (IFRS), demonstrate why and how the development of IFRS would be considered an expansion of the boundaries of accounting (Word Limit 3,000 words)
What is the impact of some businesses using International Financial Reporting Standards (IFRS) instead of generally accepted accounting principles (GAAP)? In your opinion, should there be a worldwide convergence of accounting standards? Why or why not? Explain.
With reference to the article “The Effect of Accounting Education and National Culture on Accounting Judgments: A Comparative Study of Anglo-Celtic and Chinese Culture” Chand, Cummings, Patel (2012), answer the question: Are the standards for the accounting profession truly global?
Chapter 1 Solutions
Intermediate Accounting (2nd Edition)
Ch. 1 - Prob. 1.1QCh. 1 - Prob. 1.2QCh. 1 - How is the allocation of capital linked to the...Ch. 1 - Prob. 1.4QCh. 1 - What is the function of the accounting standard...Ch. 1 - Can U.S. companies listen on U.S. stock exchanges...Ch. 1 - Prob. 1.7QCh. 1 - Prob. 1.8QCh. 1 - Prob. 1.9QCh. 1 - Prob. 1.10Q
Ch. 1 - Prob. 1.1BECh. 1 - Prob. 1.2BECh. 1 - Financial Statement Users and Other Parties...Ch. 1 - Prob. 1.4BECh. 1 - Prob. 1.5BECh. 1 - Economic Entity. What is an economic entity?Ch. 1 - Prob. 1.7BECh. 1 - Prob. 1.8BECh. 1 - Prob. 1.9BECh. 1 - Prob. 1.10BECh. 1 - Prob. 1.11BECh. 1 - Prob. 1.12BECh. 1 - Financial Accounting. Define financial accounting...Ch. 1 - Prob. 1.2ECh. 1 - Convergence of Accounting Standards, IFRS Vikram...Ch. 1 - History of Standard Setting in the United States....Ch. 1 - Prob. 1.5ECh. 1 - Prob. 1.6ECh. 1 - Rules-versus Principles-Based Accounting. Review...
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- Match the correct term with its definition. A. Financial Accounting Standards Board FASB) i. used by the FASB, which is a set of concepts that guide financial reporting B. generally accepted accounting principles (GAAP) ii. independent, nonprofit organization that sets financial accounting and reporting standards for both public- and private-sector businesses that use generally accepted accounting principles (GAAP) here in the United States C. Securities and Exchange Commission SEC) iii. standards, procedures, and principles companies must follow when preparing their financial statements D. conceptual framework iv. assumes a business will continue to operate in the foreseeable future E. going concern assumption v. independent federal agency protecting the interests of investors, regulating stock markets, and ensuring companies adhere to GAAP requirements F. time period assumption vi. companies can present useful information in shorter time periods such as years, quarters, or monthsarrow_forwardAn accounting standard is a common set of principles, standards, and procedures that define the basis of financial accounting policies and practices. Accounting standards improve the transparency of financial reporting in all countries. In the United States, the Generally Accepted Accounting Principles form the set of accounting standards widely accepted for preparing financial statements. International companies follow the International Financial Reporting Standards, which are set by the International Accounting Standards Board and serve as the guideline for non-U.S. GAAP companies reporting financial statements.Critically assess how the use of principles-based standards will aid effective standard-setting by the International Accounting Standard Board (IASB), and aid decisionusefulness for stakeholders. You should develop your arguments in the context of appropriate accounting theory?arrow_forwardWhat was the evolution of accounting theory and its significance in the contemporary business environment? What examples to illustrate how historical events and changing economic landscapes have influenced the development of accounting theory over time? Make a critical assessment of the International Accounting Standard Board’s (ASB) Conceptual framework 2018. Discuss the key elements of the conceptual framework and their role in enhancing the relevance and reliability of financial reporting.arrow_forward
- E2 global accounting standards are compelling. High quality standards by companies throughout the world has the potential to improve the comparability and transparency of financial information, List different types of accounting standards In the U.S., Generally Accepted Accounting Practices (GAAP) are the standard. In 2002, the European Union adopted IFRS Standards. Differentiate between GAAP and IFRS According to Ann Tarca (2012) “The Case for Global Accounting Standards: Arguments and Evidence” indicate several benefits in considering IFRS by the organization . Read the attached journal in the moodle and summarize the answers in your own words IFRS and Market Effciency IFRS and Economic developmentarrow_forwardOne of your clients has recently read about the goal of converging to International Accounting Standards and they are concerned about what impact it may have on their company. 1. Discuss some of the costs that a company might incur as part of its converging with International Accounting Standards. 2. Discuss why it might be important to your client to adopt International Accounting Standards even though they are currently only operating domestically throughout the central part of the United States.arrow_forwardWhat has been the major roles played by professional accounting bodies in the development of accounting in the USA, UK and Ghanaarrow_forward
- Are the standards for the accounting profession truly global With reference to the article “The Effect of Accounting Education and National Culture on Accounting Judgments: A Comparative Study of Anglo-Celtic and Chinese Culture” Chand, Cummings, Patel (2012)?arrow_forwardAn accounting standard is a common set of principles, standards, and procedures that define the basis of financial accounting policies and practices. Accounting standards improve the transparency of financial reporting in all countries. In the United States, the Generally Accepted Accounting Principles form the set of accounting standards widely accepted for preparing financial statements. International companies follow the International Financial Reporting Standards, which are set by the International Accounting Standards Board and serve as the guideline for non-U.S. GAAP companies reporting financial statements. Examine the role of accounting concepts and conventions in the preparation of financial statement?arrow_forwardWhat have been the roles played by professional accounting bodies in the development of accounting in the USA, UK, and Ghana?arrow_forward
- 1. Which of the following was the first private sector entity that set accounting standards in the United States? Accounting Principles BoardCommittee on Accounting ProcedureFinancial Accounting Standards BoardAICPA 2. ) The enhancing qualitative characteristic of understandability means that information should be understood by those who are experts in the interpretation of financial information.those who have a reasonable understanding of business and economic activities.financial analysts.CPAs. 3.) Incurring an expense for advertising on an account would be recorded by debiting liabilities.crediting assets.debiting an expense.debiting assets. 4. When a business makes an end-of-period adjusting entry with a debit to supplies expense, the usual credit entry is made to accounts payable.supplies.cash.retained earnings. 5. Temporary accounts would not include salaries payable.depreciation expense.supplies expense.cost of goods sold.arrow_forwardAnswer the following questions. Support your answers with detailed examples and explanation Question 1:- Identify and analyze the evolution of accounting theory and its significance in the contemporary business environment, providing examples to illustrate how historical events and changing economic landscapes have influenced the development of accounting theory over time. Question 2:- Assess the International Accounting Standard Board's (ASB) Conceptual framework 2018, highlighting its strength and flaws, before identifying the key elements of the conceptual framework and their role in enhancing the relevance and reliability of financial reporting. Question 3:- Based on the book "The Routledge Companion to Accounting, Reporting and Regulation" and other materials, identify and discuss what would be the major challenges and opportunities associated with international accounting standards convergence. Then analyze the implications of differences in accounting practices across…arrow_forwardQuestion #1 – What is the ‘expectations gap’? Is there even anything the accounting profession can do to close this ‘Expectations Gap’? Question #2 – To converge or not to converge, that is the question. The adoption of IFRS by U.S. companies would it easier to compare U.S. and foreign companies, as well as for U.S. companies to raise capital in foreign markets.arrow_forward
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