Class1: Over 40% of all audits inspected by the PCAOB in 2012 had deficiencies.
FVM audit deficiencies continue to be significant, making up 24.6% of total deficiencies in 2012.
There has been a significant shift in the causes of FVM deficiencies from financial instruments to business combinations. Prior to 2012, 86.9% of FVM deficiencies were caused by insufficient testing of financial instruments. In 2012, deficiencies relating to financial instrument dropped to 55.0% and those relating to business combinations increased to 45.0% of all FVM deficiencies.
The number of deficiencies caused by failures to assess risk and failures to test internal controls increased sharply in 2012
Sarbanes Oxley
Requires the CEO and CFO of a company to certify the accuracy of the financial statements with the understanding that they may be held personally criminally liable if the financial statements are found not to be accurate
Created the PCAOB with the mandate to conduct inspections of registered public accounting firms
Restricted the activities on some non audit services that may not be performed by an audit firm for its audit clients
PCAOB
The Public Company Accounting Oversight Board (PCAOB) conducts inspections of registered public accounting firms as required by he Sarbanes-Oxley Act of 2002
Designed to identify and address deficiencies in a firm’s audit engagements and to determine whether they indicate a weakness or a defect in the firm’s system of quality control over audits.
Accounting Standards Codification (ASC) database is the authoritative source for US GAAP
The purpose of the work plan is to provide the SEC with sufficient information to decide ”whether, when and how our current financial reporting system for US issuers should be transition to a system incorporating IFRS.”
Adam Smiths
New rules in recent years have required that the Fair Value (FV) of stock options to be shown as an expense in the income statement
Private company council initially emerged about 2 years ago as a sister entity to the FASB
Private company council concept: Reduce costs related to GAAP compliance for private companies – change “non-useful” data requirements
Business Combinations
Treatment of Goodwill as Amortizable
Non compete & customer related intangibles in goodwill
Impairment
Goodwill testing only upon “triggering event” – not annually
Goodwill tested at “entity level” instead of lower level “reporting unit level”
Class 4
Fair value shall be measured using assumptions that market participants, acting in their economic best interests, would use when pricing the asset or liability
Markets participants are the buyers and sellers of an asset or liability in the exit market and are independent of each other.
Market participants must have both the willingness and the ability to transact at fair value
Fair value is not the value specific to the reporting entity, nor is it necessarily the specific value to one market participant whose risk assessment may significantly differ (e.g., an outlier) from other market participants.
Level 2 – Observable inputs (directly or indirectly) other than quoted prices included within Level 1 for identical assets and liabilities ( Use data from prices for similar assets and adjust)
A fair value measurement of a financial liability or a non-financial liability assumes that the liability, is transferred to a market participant at the measurement date
A fair value measurement of a financial liability or a non-financial liability assumes that the liability, is transferred to a market participant at the measurement date (that is, the liability would continue and the market participant transferee would be required to fulfill the obligation; it would not be settled with the counterparty or otherwise extinguished on the measurement date).
The standard requires that the fair value of a liability include the non-performance risk related to the liability being measured. This refers to the risk that an obligation
procedures, including modeling (e.g., engaging characters make changes themselves, and face and overcome challenges related to fruit and vegetable (FV) and physical activity (PA) goal attainment and/or consumption), skill development (e.g., asking behaviors; virtual recipe preparation), self regulatory behaviors (problem solving, goal setting, goal review, decision making), rewards (e.g., points and positive statements generated by the program), immediate feedback (e.g., through characters and/or…
Personal Finance BUE-101 December 2012 Review Questions, Chapter 1 1a. As for the single parent of two school-aged children who is currently unemployed the most important financial goals would be to obtain appropriate career training, seek employment, and create a flexible budget to follow. They should also reduce their debt level and have an emergency savings fund. Some specific financial activities…
A Fresh Look at the WACC This case provides a comprehensive and realistic review of WACC computations and some of the theoretical questions related to the WACC and its uses. 1. Compute the yield to maturity and the after-tax cost of debt for the two bond issues. Bond 1 $1031 = 35 × (1-(1/(1+YTM/2)12)/r)+1000/(1+YTM/2)12 By trial and error, YTM/2 =3.185%. YTM = Rd = 6.37% Using a calculator, N=12, PV = -1031, PMT = 35, FV = 1000, solve for i/y = 3.185% Bond 2 $1035 = 40 × (1-(1/(1+YTM/2)32)/r)+1000/(1+YTM/2)32…
1.The Dumonts are in the early years of the accumulation of wealth stage of the financial life cycle. During this longest stage of the life cycle, the Dumonts will establish their lifestyle and build a foundation for the two later stages. This phase is characterized by: 1. The Dumonts are in the early years of the accumulation of wealth stage of the financial life cycle. During this longest stage of the life cycle, the Dumonts will establish their lifestyle and build a foundation for the two later…
ACC CGCC ACCOUNTING 240 EXAM #2 REVIEW CH 18,22,23 1. Budgets • Purposes of personal budgeting. o See first and second purposes pg 874. To develop a plan to meet a goal, and to allow ongoing comparisons between actual results and the plan. o See 3rd paragraph pg. 875. For sure an exam question. “Individual who budget successfully typically find that they can purchase those things that they feel they really want to have. In fact…
1 Summary of key provisions of IAS & IFRS which may be relevant to ACCA financial reporting and audit papers for 2013 examinations Note – you may want to refer to your ACCA Paper F7 Financial Reporting and P2 Corporate Reporting study materials for further detailed information. Note – you should not rely upon this document for knowledge and understanding of all aspects of these reporting standards and other examinable documents; rather they should be used as an aid or as a prompt to your studies…
Review Test Submission: Part 2 Quiz Content User Brooke B Hewitt Course BA 520: Financial Strat/Tech(68796-W15) Test Part 2 Quiz Started 1/7/15 9:25 PM Submitted 1/8/15 2:20 PM Status Completed Attempt Score 75 out of 75 points Time Elapsed 16 hours, 55 minutes. Instructions Question 1 3 out of 3 points Starting to invest early for retirement increases the benefits of compound interest. Correct Answer: True Question 2 3 out of 3 points A time line is meaningful even if all cash…
Subsidiary account (DR) and CR gain on purchase of Subsidiary, which is closed to Parent’s net income and retained earnings (see example page 162). Not the same as negative acquisition differential (CV of sub’s net assets exceed acquisition cost). If FV of net asset < CV of net assets, the FVIs negative amounts could offset some or exceed the negative AD, hence result in a positive goodwill. Subsidiary with Goodwill: Do not carry forward goodwill appearing on the subsidiary’s balance sheet, as it…
INTRTODUCTION The United States of America has a huge influence on the accounting standards all over the world. USA follows Financial Accounting Standards Board (FASB), which has many standards that are disseminated by the international accounting standards committees. Rest of the world is following International Accounting Standards Board (IASB). So to remove the differences between these two accounting board, in September 2002 the IASB and the FASB agreed to work together along with other…
such as thinking and reasoning skills. Hence, try to visit and check the current news in one of the web sites above on a regular basis during and after the term. Financial Calculator Financial Calculator (BA II Plus, TI : N – I/Y – PV – PMT – FV) : No matter what calculator you use, it is your responsibility to learn how to use the calculator. The financial calculator is a tool and not a purpose in this class, as it will just help us learn some key theories (such as financial asset values)…