Exam 12: Disclosure: Legal Requirements and Accounting Polices

A departure from Australian Accounting Standards may be allowed if two conditions are met.These are that management concludes that compliance would be so misleading that it would conflict with the objective of financial statements,and:

A company's workforce went on strike for an indefinite period commencing on 5 August 20X1.The strike was expected to cause severe financial conditions for the company.The financial statements for the year ended 30 June 20X1 were expected to be completed by 7 August 20X1.In accordance with AASB 110 Events after the Reporting Date,the appropriate treatment regarding the strike is:

The Corporations Act allows a company the right to prepare and send a concise report to members which consists of: I.a financial report drawn up in accordance with accounting standards. II.a directors' report for the year. III.an auditor's statement. IV.a statement that the report is a concise report and that the full financial report and auditor's report is available if requested.

Which of the following does not require disclosure in an entity's accounting policy note?

Explain the implication for the future of an entity if its financial statements are not prepared on a going concern basis.

Which of the following statements is correct?

Distinguish between the concepts of a 'true and fair view' and 'present fairly'.

In Australia an entity that has users who are not in a position to demand reports tailored to their particular information needs must prepare;

The term 'true and fair override' is used to describe a situation where an entity has:

Which of the following requires disclosure in an entity's accounting policy note?

Explain why shareholders may prefer to use a concise financial report.

According to the Corporations Act a company is compelled to include the following financial statements in its annual financial report: I statement of comprehensive income II statement of profit and loss III statement of financial position IV statement of changes in equity V statement of cash flows

Where a fundamental error occurs in the recognition process:

Where an accounting estimate has been revised materially the item is:

Explain the meaning of the term 'true and fair override'.

When assessing the materiality of a bad debtor,the accountant of Azad Limited concluded that in conformity with guidelines provided in AASB 1031 Materiality,it was not likely to be material as it:

ABC Ltd has discovered that the useful life estimate it made on a material depreciable asset was incorrect.The correct treatment of this event is:

Changes in errors are required to be applied:

Half yearly reports are required to be prepared by:

The directors of the company are undecided as to whether they should amend the financial statements to provide for additional doubtful debts of $150 000 as at 30 June 20X7.In accordance with the quantitative guidelines in AASB 1031 Materiality,the additional doubtful debts of $150 000 would be material as it represents: