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17 Cards in this Set

  • Front
  • Back
Accounting standards and interpretations are issued by the:
What is the purpose of information presented in notes to the financial statements?
To provide disclosure required by generally accepted accounting principles
What provides the best indication of an enterprise's present and continuing ability to generate favorable cash flows?
Accrual basis accounting
Who are the 4 parties involved in standard setting?
1. SEC (govt. organization)
2. FASB (non-govt.)
3. AICPA (private organization)
International accounting standards are established by the:
An effective process of capital allocation is critical to a healthy economy, which does what 3 things?
a) Promotes productivity
b) Encourages innovation
c) Provides an efficient and liquid market for buying and selling securities
A non-government organization that is responsible for issuing financial accounting standards for business organizations:
All of the following are objectives of financial reporting except to provide information

a) About enterprise resources, claims to those resources, and changes in them.
b) That is useful in investment and credit decisions.
c) About the management and major shareholders of an enterprise.
d) That is useful in assessing cash flow prospects.
c) About the management and major shareholders of an enterprise
What organization requires public companies to adhere to GAAP?
What are the 3 types of pronouncements issued by the FASB?
1) Standards, Interpretations, and Staff Positions
2) Financial Accounting Concepts
3) Emerging Issues Task Force Statements
Organization established by federal government that performs accounting and reporting for public companies:
Which accounting pronouncement is the most authoritative?
AICPA Accounting Principles Board Opinion
Financial Accounting Standards Board that consults companies on major policy issues:
Financial Accounting Standards Advisory Council
A national professional organization that established the 'Committee on Accounting Procedures' and the 'Accounting Principles Board':

All those who serve on the FASB must be Certified Public Accountants.
What are the 2 sets of accounting standards accepted for international use?
1) U.S. GAAP, issued by the FASB

2) International Financial Reporting Standards (IFRS), issued by the IASB
What are 3 common issues faced in financial reporting?
1) Expectation gap
2) International accounting standards
3) Ethics