Exam 1: The Financial Reporting Environment

Which user group is the group of individuals who are owners of a corporation?

Fair value measurements are a long-standing tradition in U.S.GAAP.

The FASB gives the SEC authority to regulate accounting for publicly traded companies.

All of the following organizations have set financial accounting standards for U.S.companies except ________.

List the seven steps of the FASB standard-setting process.

During the standard-setting process,an ________ is issued by the FASB to solicit input from financial statement preparers,auditors,and other users of financial statements.

Rules-based standards rely on theories and concepts that are linked to a well-developed theoretical framework.

U.S.GAAP contains more rules-based standards than IFRS.

Contrast the differences between rules-based standards and principles-based standards.

Official U.S.GAAP consist of the bulletins,opinions,and statements issued by the CAP,the APB,and the FASB.

Objectives-based standards are deemed to be more optimally appropriate than rules-based standards and principles-based standards.

FASB is financed primarily by government-provided fund from fees assessed against companies that issue equity securities.

Which of the following statements is FALSE?

The FASB standard-setting process requires a post-implementation review of each new standard.

List four reasons why it is important for an accountant in the United States to learn international accounting standards?

Which of the following user groups consists of individuals that provide guidance to others in making investment and credit decisions?

Principles-based standards are deemed to be more optimally appropriate than rules-based standards and objectives-based standards.

Standard setters develop accounting standards based on natural economic laws.

The Security Exchange Commission (SEC)regulates financial reporting for publicly traded companies.

Accountants in the United States do not need to learn international accounting standards.