The explanatory notes to the financial statements: should be referred to if more

Question

The explanatory notes to the financial statements:

should be referred to if more than a cursory, and perhaps misleading impression of a firm's financial position and its results of operations is to be achieved.

are not an integral part of the financial statements.

include a great deal of detailed information that is potentially useful only to a financial analyst making a detailed appraisal of the future prospects of the entity.

are used by many entities to hide information from the reader of the financial statements by including in the explanatory notes information that should be shown in detail on the financial statements themselves.


The nature and content of disclosures relate to all of the following except:

accounting changes.

segment information.

fair market value.

contingencies and commitments.

events subsequent to the balance sheet date.


Corporate governance includes concerns about:

business ethics and social responsibility.

the responsibilities of the board of directors.

equitable treatment of stakeholders.

disclosures and transparency.

all of the above.

Explanation / Answer

1. should be referred to if more than a cursory, and perhaps misleading impression of a firm's financial position and its results of operations is to be achieved. 2. events subsequent to the balance sheet date. 3. all of the above.

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