What is the major difference between the approach of international financial reporting standards versus U.S. GAAP accounting? What are the advantages and disadvantages of each?

Choose the correct. Which of the following statements is not true under U.S. GAAP?a. Operating segments can be determined by looking at a company’s organization chart.b. Companies must combine individual foreign countries into geographic areas to comply with the geographic area disclosure requirements.                c. Companies that define their operating segments by product lines must provide revenue and asset information for the domestic country, for all foreign countries in total, and for each material foreign country.d. Companies must disclose total assets, investment in equity method affiliates, and total expenditures for long-lived assets by operating segment.

Which factor explaining why accounting practices differ across countries do you think is most important? Explain why.

Which of the following is not a problem caused by diversity in accounting practices across countries? Multiple Choice Comparing companies in the same industry that are headquartered in different countries. Translating foreign currency balances into U.S. dollars. Converting local GAAP financial statements into U.S. GAAP for consolidation purposes. Maintaining separate accounting records in both the local and U.S. GAAP. Identifying and retaining personnel who are competent to prepare financial statements in both international and domestic accounting standards.

In accordance with U.S. generally accepted accounting principles, which translation combination is appropriate for a foreign operation whose functional currency is the U.S. dollar? Choose the correct option.   Method Treatmemt of transition adjustment a. Current rate other comprehensive income b. Current rate Gain or loss in net income c. Temporal other comprehensive income d. Temporal Gain or loss in net income

Which of the following statements is not true under U.S. GAAP?a. Operating segments can be determined by looking at a company’s organization chart.b. Companies must combine individual foreign countries into geographic areas to comply with the geographic area disclosure requirements.c. Companies that define their operating segments by product lines must provide revenue and asset information for the domestic country, for all foreign countries in total, and for each material foreign country.d. Companies must disclose total assets, investment in equity method affiliates, and total expendi­tures for long-lived assets by operating segment.

Companies that compete in an international marketplace may be faced with three types of risk owing to foreign exchange.These are: *       A. specific, translation and transaction risk.       B. translation, transaction and economic risk.       C. accounting, transaction and translation risk.       D. accounting, specific and transaction risk.

What are some of the differences between International Financial Reporting Standards (IFRS) and U.S. Generally Accepted Accounting Principles (GAAP)? What are some advantages and disadvantages of adopting IFRS in the US?

A key issue facing financial executives of multinational firms is exposure to exchange rate changes.a. Define exposure, differentiating between accounting and economic exposure. What role does inflation play?b. Describe at least three circumstances under which economic exposure is likely to exist? c. Of what relevance are the international Fisher effect and purchasing power parity to your answers to parts a and b? d. What is exchange risk, as distinct from exposure