Evaluate the reasons business combinations occur and the accounting implications

Question

Evaluate the reasons business combinations occur and the accounting implications of such transactions.

Critique the development of International Accounting Standards and the implications for US corporations.

Measure the accounting for foreign currency and its translation.

Assess the proper accounting for transactions with respect to deferred taxes and leases using the accounting codification and other accounting research tools.

Justify the proper accounting for transactions with respect to accounting changes and error corrections using the accounting codification and other accounting research tools

Evaluate the proper accounting for transactions with respect to interim and segment reporting using the accounting codification and other accounting research tools

Explanation / Answer

Financial reporting is pivotal in communicating with investors, creditors, regulators, employees and many other stakeholders of modern businesses. The quality of financial reporting depends not only on audit and assurance practitioners but also on the preparation process of financial reporting. To have high quality financial reporting, we should help directors and preparers get it right from the start. We bring together authors from practitioners and academia to contribute articles on the topic of “Getting your accounting right”. The objective is to help business directors and accounts preparers to understand the importance of high quality financial reporting to their business and get it right from the start. High quality financial reporting is a process, not a fixed destination. It is a journey that begins with a better understanding of the various stakeholders in the ecosystem, the key elements in ecosystem and getting a grip on the continuing changes in financial reporting standards that will lead to a more relevant and faithful representation of economic phenomenon of a business. We do not have all the answers in this book, but we have put together articles that would hopefully point readers to the right directions and provide references for further reading. In Part 1, we start by presenting an ecosystem for achieving high quality financial information, followed by some guides to preparing financial reports. We have included in Part 2 important technical updates of major accounting standards that would shape financial reporting in the coming years. This book is organised as follows: The first part (Chapters 1-8) provides guides to preparing high quality financial reports. Chapter 1 explores an ecosystem for achieving high quality financial information. In this chapter, the authors describe the needs of high quality financial information and it is importance to all businesses. The authors have included various views from the top, from leaders in the accounting profession to business leaders, regulators and other parties, on the benefits of high quality financial information. All business owners and investors need to understand financial reports. Such an understanding will help to speed up the dissemination of information, reduce information asymmetry and lower a company’s cost to access capital. Thus, Chapter 2 will help readers understand the four primary financial statements and suggest a simple approach to reading financial reports This chapter is especially important to investors and managers who may not have enough prior accounting knowledge. Chapter 3 explains some myths about financial reporting and accounting standards. It is the duty of directors to ensure financial statements are prepared, audited and filed properly, but some do so grudgingly, looking for the cheapest, fastest, easiest way to prepare, audit and file their financial statements. This chapter discusses three claims about financial reporting: (1) “management do not use financial statements”, (2) “financial statements do not matter”, and (3) “financial statements are just too complex”. In Chapter 4, the authors present an overview of governance regulatory framework for financial reporting in Singapore, including Companies Act, Code of Corporate Governance and Singapore Exchange’s Listing Manual. The chapter also presents a portfolio of internal controls over financial reporting and a check list f x xi Chapters 5-7 explore three important processes of nancial reporting: closing the accounts, auditing the accounts and ling the accounts. In Chapter 5 , the authors discuss why audit and assurance are needed and what exactly external auditors do when auditing accounts. Auditing and assurance play an essential role in the effective operation of our capital markets and the economy at large, providing condence to current and prospective shareholders about the information disclosed by companies. The nancial close is an important element in the preparation of nancial statements. Chapter 6 shows how companies can improve their closing process. It starts by identifying the value that an effective close can bring. Companies should ensure that their nancial close processes work efciently and effectively. They need to develop (and implement) a concrete plan to monitor and reduce inefciencies in their close process. Chapter 7 presents an overview on how to prepare high quality XBRL nancial statements, including some common errors observed by ACRA. Investors increasingly expect quick and convenient access to information and expect the information to be of a high standard - up to date, complete and accurate. Companies can meet these new expectations by ling high quality XBRL nancial statements with ACRA. If you are a director of small entity, you may opt to use a simplied accounting standard – SFRS for Small Entities. Chapter 8 explains why the simplied accounting standard is benecial to small and medium-sized companies and presents the major differences from the full SFRS. The major takeaway is that adopting SFRS for Small Entities will signicantly reduce compliance costs and cost to access capital for your small business. In the second part of this book (Chapters 9-12), we summarise some major technical updates on a number of critical accounting standards. They include fair value measurement (Chapter 9) , consolidation (Chapter 10) , nancial instruments (Chapter 11) and revenue accounting and annual improvements project of IASB (Chapter 12) . We trust these four chapters cover the most important and controversial changes in the recent development of accounting

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.