1) (1) The U.S. GAAP section 360-10-35-21 states “A long-lived asset (asset group) shall be tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable”. An example of an event like this is a significant decrease in the market price of a long-lived asset. As stated in the case‚ one of Ida’s competitors sold its extremely comparable commercial building for an amount significantly less than its asking price. Since these assets are
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No. 2005–57 ROYAL AHOLD: A FAILURE OF CORPORATE GOVERNANCE AND AN ACCOUNTING SCANDAL By Abe de Jong‚ Douglas V. DeJong‚ Gerard Mertens‚ Peter Roosenboom March 2005 ISSN 0924-7815 Royal Ahold: A Failure of Corporate Governance and an Accounting Scandal Abe de Jong* Department of Financial Management Erasmus University Rotterdam a.jong@fbk.eur.nl Douglas V. DeJong Tippie College of Business University of Iowa douglas-dejong@uiowa.edu Gerard Mertens Department of Financial Management Erasmus
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affect future periods and also affect the current period‚ disclosures of the effect of the change are required. Correction of errors is a correction of an error in previous financial statements. It also may be viewed as change from one non-GAAP method to GAAP. Corrections of errors are shown as restatement and it is treated retrospectively. This is done by restating comparative financial statements along with prior period adjustment. The nature of the error correction must be disclosed in the year
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accounting for changes in estimates and accounting principle is similar between GAAP and IFRS. They both indicate that companies
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Weekly Case Notes--Essar Energy: Indian GAAP‚ U.S GAAP or IFRS Internal issues: The company needs to change their accounting standards to IFRS without sufficient knowledge of IFRS. The company needs to hire new employees that have the adequate IFRS knowledge and sensitive to the differences between IFRS and Indian GAAP. The employees require extra time for training There were huge accounting tasks needs to involve many employees under various departments‚ such as the plant head required
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Case 1-1 E-Centives‚ Inc.—Raising Capital in Switzerland 1. Possible factors (from Exhibit 1-7) relevant in e-centives decision to raise capital and list on the Swiss Exchange s New Market: a. Ease of raising capital (point 3). The Swiss Exchange s New Market has simple listing requirements designed to appeal to small companies. The contrast with the complex‚ detailed listing and reporting requirements in the United States is striking. b. Availability of capital (point
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information of a company. “GAAP cover such things as revenue recognition‚ balance sheet item classification and outstanding share measurements.” (http://www.investopedia.com) Abercrombie and Fitch’s headquarters is based out of New Albany‚ Ohio. The company has over 300 stores that operate within the United States. Even though the company is headquartered in the US it does have operations abroad. Even though Abercrombie and Fitch have locations abroad they will follow GAAP vice the IFRS. Abercrombie
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CHAPTER 2 Professional Standards LEARNING OBJECTIVES | | | | | | |Exercises‚ Problems‚ and | | |Review Checkpoints |Simulations | |
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prevalent in business. In addition to strengthening competition of the combined companies‚ several goals are met such as tax reductions‚ growth and diversification‚ a larger financial base‚ and increase profits. Generally Accepted Accounting Principles (GAAP) does not require separate financial statements of the companies merged. SFAS No.
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Differences between U.S. GAAP and IFRS with regard to errors are that GAAP indicates a generally stricter interpretation of how the error should be handled. Regarding question #1‚ GAAP states that all prior periods affected should be re- stated and balances rolled forward accordingly. IFRS allows in statement IAS 8‚ para 49 for the subjective evaluation of practicality with regard to how far back the re-statement should go. Question # 2‚ GAAP states that the
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