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Distinguish between generally accepted auditing standard and generally accepted accounting principle?
general standards field work of standards reporting standards
Is conceptual framework a reporting standard?
Not exactly. The FASB conceptual framework sets the general philosophies that the specific reporting standards are based on. For example, the framework establishes that the accrual basis of accounting should be used; the idea that expenses should be matched with the corresponding revenues (the Matching Principle), the Principle of Conservatism, etc. The specific reporting standards generally work inside this framework, unless doing so would mislead financial statement users.
Who formulated the General accepted accounting principles?
Financial Accounting Standards Board
The minimum requirements for general purpose external financial reporting include what?
Management's Discussion & Analysis (MD&A)
Transaction definition in GFEBS?
In GFEBS (General Fund Enterprise Business System), a transaction refers to any financial operation or activity that impacts the organization's financial records. This can include purchases, sales, payments, receipts, and adjustments that are captured and processed within the system to maintain accurate financial data and reporting. Transactions in GFEBS are typically recorded in accordance with government accounting standards and guidelines.
Why do companies use different depreciation methods for tax reporting and financial reporting?
Answer:Companies make different accounting choices for tax reporting and general financial reporting, because different incentives are in place. A profitable firm will most likely want to minimize income tax. As a result, management will make accounting choices that minimize net income, and as a result, minimize tax payments. Accounting choices that reduce taxable income include for example accelerated depreciation (instead of straight line) and LIFO (as opposed to FIFO).For general purpose financial reporting, management may want to show a more realistic picture of firm profitability (instead of showing the (legally) lowest possible net income number). So, accounting choices that are made for tax purposes are not always repeated for the general financial reporting.
Advantages of accounting standard?
Accounting Standards facilitate uniform preparation and repoting of general purpose financial statements published annually for the benefit of shareholders, creditors, employees and the public at large.The standards issued should be consistent with the provisions of law.Thus, they are very useful to the investors and other external groups in assessing the progress and prospects of alternative investments in different companies in different countries.Standards will help public accountant to deal with their clients by providing rules of authority to which the acoountants can appeal, in their task of preparing financial on a true and a fair basis.Accounting standards will rise the standards of audit itself in its task of reporting on the financial statements.
What is the differences between decision usefulness and accountability objectives of general purpose financial reporting?
Accountability is the classical view on financial reports meaning u should report as close to real world as possible. Decission usefullness is about reporting as what should be best for decissionmakers(investors)
What groups uses accounting information primarily to help protect the public?
Regulatory agencies, such as the Securities and Exchange Commission (SEC) and the Financial Accounting Standards Board (FASB), primarily use accounting information to help protect the public. These organizations oversee financial reporting standards and ensure transparency in financial disclosures, which safeguards investors and the general public from fraudulent practices. Additionally, consumer protection agencies may utilize accounting data to monitor businesses and ensure compliance with fair trading practices.
What are the criteria for general acceptance of accounting principles?
Some GAAP principles are meant to improve or standardize recording and reporting of financial statements. Companies are expected to follow the GAAP principles when presenting financial statements.
What is the code city for ally financiall?
The code city for Ally Financial is Detroit, Michigan. This designation is often used for regulatory and financial reporting purposes. Ally Financial, originally part of General Motors, has its headquarters in Detroit, connecting it to the city's financial and automotive history.
What is the fourth principle of the GASB?
To consider the applicability of its standards to the separately issued general-purpose financial statements of governmentally owned special entities.
