International Financial Reporting Standards:
They are commonly known as IFRS. It is a set of accounting standards which are developed by independent (Non-profit) organization called as International Accounting Standards Board (IASB). It is universally accepted set of standards which states the rules and practice for accounting practice.
Generally Accepted Accounting Principles:
They are commonly known as GAAP. It is a collection of generally practiced and followed rules and standards of accounting. GAAP provides global guidelines for preparation and disclosure of financial statements of public companies. It is created and developed by International Accounting Standards Board (IASB).
To explain: Does U.S. GAAP and IFRS differs in the criteria they use and to determine whether a transfer of receivables is treated as a sale.
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INTERMEDIATE ACCT VOL.2>CUSTOM<
- Which of the following items will result to foreign currency transaction gain/loss due to settlement or remeasurement? Foreign currency denominated non-monetary liabilities such as unearned revenue, warranty liability, premium liability and deferred tax liability. Foreign currency denominated non-monetary assets such as inventory, PPE, intangible asset or prepaid asset. Foreign currency denominated monetary items such as accounts payable, accounts receivable, notes payable, loans receivable or interest payable. Foreign currency denominated income statement accounts such as revenue, income, expense or loss.arrow_forwardwhat are implications for analysis of financial statements that result from the accounting for foreign currency translation?arrow_forwardwhich shall be recognized for each item when foreign currency gain or loss that arises from translation of foreign currency denominated transaction to functional currency? a. inventiry b. interest expense c. accounts receivable d. unearned revenuearrow_forward
- When should a transfer of receivables be recorded as a sale? A) The buyer surrenders controlof the receivables to the seller. B) The transferor maintains effective control over the transferred assets through an agreement to repurchase or redeeem them prior to their maturity. C) The transferee cannot pledge or exchange the transferred assets. D) The transferred asstes are isolated from the transferor.arrow_forwardDiscuss the primary differences between U.S. GAAP and IFRS with respect to revenue recognition.arrow_forwarddescribe foreign currency transaction exposure, including accounting for and disclosuresabout foreign currency transaction gains and lossesarrow_forward
- What are the reporting issues in a sale with a repurchase agreement?arrow_forwardIf the functional currency is determined to not be the foreign entity's local currency, translation is done using a. the current rate method b. the functional method c. the remeasurement method d. the derivative methodarrow_forwardWhat causes balance sheet (or translation) exposure to foreign exchange risk? How does balance sheet exposure compare with transaction exposure?arrow_forward
- According to PAS 21, exchange differences arising from the translation of monetary items arising from foreign currency transactions are recognized in * A. Directly in equity B. Any of these C. Other comprehensive income D. Profit or lossarrow_forwardWhat concept underlies the two-transaction perspective in accounting for foreign currency transactions?arrow_forwardExplain the difference between Trade Payable and Other Payable with relevant examples.arrow_forward
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