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24 Cards in this Set
- Front
- Back
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SEC
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Securities and Exchange Commission - Securities Act of 1934
FRR-Financial Reporting Release ASR-Accounting Series Release IR-Interpretative Releases SAB-Staff Accounting Bulletins EITF- |
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CAP
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Committee on Accounting Procedure - Determined GAAP 1959-1973 part-time committee of AICPA
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APB
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Accounting Principles Board -APBO Accounting Princiles Board Opinions APB Interpretations to determine GAAP 1959-1973 Part-time committee of AICPA
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FASB
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Financial Accounting Standards Board 1973-
determines GAAP through 2009 SFAS, FIN, FTB, EITF FASB Implementation Guides and Statements of Financial Accounting Concepts (SFAC) |
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US GAAP - FASB Accounting Standards Codification
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7/1/2009-
Single source of authoritative nongovernmental US GAAP |
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Authoritative Literature Included in the Codification (FEDPRIA)
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FASB
Emerging Issues Task Forse (EITF) Derivative Implementation Group Issues accounting Principles Board Opinions accounting Research Bulletins accounting Interpretations American Institute of Certified Public Accountants |
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IASB
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FASB counterpart -2001
Purpose is to develop a single set of high quality, global accounting standards |
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IFRIC - International Financial Reporting Interpretations Committee
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provides guidance on newly identified financial reporting issues not addressed in the IFRSs and assists the IASB in achieving international convergence of accounting standards
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IFRS - International Financial Reporting Standards
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Includes IFRS and IAS (International Accounting Standards)
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International Convergence of Accounting Standards
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since 2002 - goal - a single set of high-quality, international accounting standards that companies can use for both domestic and cross-border financial reporting.FASB issues GAAP and IASB issues IFRS - expectation that over time two sets become similar
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Adoption of IFRS in the US
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SEC supports convergence. companies will need at least 4 to 5 yrs to shift from US GAAP to IFRS
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Financial Accounting
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external users.
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FASB - Statement of Financial Accounting Concepts (SFAC)
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1. Objectives of Financial Reportingby Business Enterprises
2. Qualitative Characteristics of Accounting Information 3.Elements of Financial Statements of a Business 4. Objectives of Financial Reporting by Nonbusiness Organizations 5. Recognition and Measurement in the Financial Statements 6. Elements of Financial Statements 7. Using Cash Flow Information and Present Value in Accounting Measurements |
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SFAC 1
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external users. disclose entity's performance. Focus is on informational needs of external users. value. risk/required rate of return.
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SFAC 2
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hierarchy of qualitative characteristics - the most useful information. understandable, relevant, reliable, comparable, consistent, materia and less costly than the benefit
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Hierarchy of Accounting Qualities BUD r&r c&c
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Benefits>costs
Understandability Decision Usefulness Relevance & Reliability (primary) Comparability & Consistency (secondary) |
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Reliability (Nobody Relies on Financials unless Verified)
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Neutrality
Representational Faithfulness Verfiability |
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Secondary Characteristics of SFAC 2
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Comparability and Consistency
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SFAC 7
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provides a framework for accountants to employ when using future cash flows as a measurement basis for assets and liabilities, especially when the factors to consider in the measurement are complex.
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5 elements of Present Value Measurement of assets or liabilities under SFAC 7
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1. estimate of future cash flow
2. expectations about timing variations of future cash flows 3. time value of money (the risk-free rate of interest) 4. the price for bearing uncertainty 5. other factors (liquidity issues and market imperfections) |
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Income Statement
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Performance for "period of time"
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Use of Income Statement
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the IS is useful in determining profitability, value for investment purposes, and credit worthiness. the IS is also useful in predicting information about future cash flows
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Presentation order of major components of an IS and Ret Earning Statement
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1. Income (or Loss) from CONTINUING Operations
2. Income (or Loss) from Discontinued Operations 3. Extraordinary Items Retained Earnings - Cumulative Effect of Change in Accounting Principle (reported net of tax as General rule) GAAP to GAAP |
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Multistep Income Statement
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Study well
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