Accounting Principles Board (APB) Opinions 5. Accounting Research Bulletins (ARB) 6. Accounting Interpretations (AIN) 7. American Institute of Certified Public Accountants (AICPA) a. Statements of Position (SOP) b.
Basis of Preparation The financial statements are prepared in accordance with the applicable law and under the convention of Historical cost. The preparation is governed by the Generally Accepted Accounting Principles (GAAP) rules and the regulations from the Association of Chartered Certified Accountants and Chartered Institute of Management Accountants (CIMA) 3. Basis of Consolidation The following financial statements are those of the company and its subsidiaries up to the end of the 2011 financial year. Results of subsidiaries disposed or acquired in the course of the year are included in the income statement up to the disposal date or from the acquisition date. Joint ventures are the undertakings that the company has a long term interest and shares its control jointly with another entity (Kones 2009, 45).
TABLE OF CONENTS INTRODUCTION PG 1 COMPANY EVALUATION PG 2 COMPLIANCE AND RECOMMENDATION PG 4 SUMMARY / CONCLUSION PG 5 REFERENCES PG 6 Introduction The primary objective of Accounting Ink, is to provide LJB Company with the required information to consider the regulations for converting to a publicly traded company. Within this analysis we will identify internal controls currently being used within business operation and the required mandated internal controls enforced by the Sarbanes Oxley Act. Internal Controls are established and or regulated by the Sarbanes-Oxley Act. There are six principles of internal controls 1) Establishment of responsibility, 2) Segregation of Duties, 3) Documentation Procedures, 4) Physical Controls, 5) Independent Internal Verification and 6) Human Resource Controls (Keller, 2012). Companies and their independent accountants or auditors should report the effectiveness of the companies internal controls based on these six principles.
Accrual and Cash Accounting XACC 290 October 5, 2014 Jana Rideout Accrual and Cash Accounting Introduction In business, there are many different forms and standards to accounting. These standards are governed by rules, laws, regulations and accurate accountability of a particular business account. There are some general differences between general and commercial basis accounting principles, also differences between accrual and cash basis accounting. Those differences will be looked at here. General and Commercial Basis Accounting Principles Generally accepted accounting principles (GAAP) state the standard framework of guidelines for financial accounting used in any given jurisdiction; commonly known as standard accounting practice or accounting standards.
FASB Codification System The Securities and Exchange Commission (SEC) and the American Institute of Certified Public Accountants (AICPA) recognizes the Financial Accounting Standards Board (FASB) as an authoritative organization since 1973 (Facts about FASB, n.d.). The FASB is an organization designed to establish standards for financial accounting that oversee the preparation of all financial reports by any nongovernmental entity. The FASB has designed the Accounting Standards Codification to assist with the assembling a localized location to search authoritative resources regarding accounting standards. FASB Codification System and Its Purpose The FASB Codification system is defined by the FASB as, “a database and research system developed by the Financial Accounting Standards Board (FASB) that pulls together many of the authoritative resources about accounting standards into a single, searchable system” (Financial Accounting Standards Board, n.d.). The purpose of the FASB Codification is to allow accounting and reporting professionals access to an online database that makes finding and navigating through authoritative accounting standards simpler and easier.
III. Alternatives available to report the issue discussed above indicating the authoritative basis The Statement of Financial Accounting Standards No.13 defines the following: Related parties in leasing transactions - A parent company and its subsidiaries, an owner company and its joint ventures (corporate or otherwise) and partnerships, and an investor (including a natural person) and its investees (the business entity
The Financial Accounting Standards Board (FASB) started in 1973 to provide standards for private sector companies to prepare their financial statements. The Securities and Exchange Commission (SEC) recognizes the standards given by the FASB as authoritative as long as the FASB fully acts in public interest. FASB standards are used by companies in the United States and IASB standards are used for companies in other areas of the world (Schroeder, Clark, & Cathey, 2011). The International Accounting Standards Board (IASB) was formed in 2001 to promote the use of international accounting standards. The IASB was formed to replace the IASC.
a.|auditing existing data| b.|collecting and recording data| c.|providing information to users| d.|analyzing and managing data| ANS: A PTS: 1 DIF: Moderate OBJ: 1-1 NAT: AACSB Reflective 3. In an accounting information system, the inputs are usually a.|financial statements.| b.|analyzing data.| c.|performance reports.| d.|economic events.| ANS: D PTS: 1 DIF: Easy OBJ: 1-1 NAT: AACSB Reflective 4. _______________ is devoted to providing information for external users. a.|Management accounting| b.|Financial accounting| c.|Internal accounting| d.|Cost accounting| ANS: B PTS: 1 DIF: Easy OBJ: 1-1 NAT: AACSB Communication 5. Financial accounting information is used for a.|investment decisions.| b.|regulatory measures.| c.|stewardship evaluation.| d.|all of these.| ANS: D PTS: 1 DIF: Easy OBJ: 1-1 NAT: AACSB Communication 6.
Reference Financial Accounting Standards Board (2010).Statement of Financial Accounting Standards No. 5: Accounting for Contingencies. Retrieved June 16, 2010. Retrieved from
b. Internal Revenue Service. c. Financial Accounting Standards Board. d. Corporate Board of Directors. 2.