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The Canadian Financial Reporting Environment

In: Business and Management

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CHAPTER 1

THE CANADIAN

FINANCIAL REPORTING ENVIRONMENT

Multiple Choice—Conceptual

Answer No. Description d 1. Accounting characteristics. a 2. Nature of financial accounting. c 3. Definition of financial accounting. a 4. Financial reporting entity. d 5. Efficient use of resources. d 6. Capital allocation process. c 7. Assessing management stewardship. c 8. Objectives of financial reporting. a 9. Role of AcSB. c 10. Body responsible for setting GAAP. b 11. Preparation of biased information. d 12. Parties instrumental in development of reporting standards. d 13. Stakeholders in the financial reporting environment.. a 14. “Due process”. d 15. Causes of subprime lending crisis. d 16. Management bias. b 17. Adoption of IFRS. c 18. Role of OSC. d 19. Definition of GAAP. b 20. Changing nature of the economy. d 21. Exercise of professional judgement. c 22. Major factors in the reporting environment. a 23. Impact of technology on financial reporting. b 24. Nature of the “Balanced Scorecard”. a 25. Responsibility for financial statements. d 26. GAAP for private enterprises. d 27. Reporting principles b 28. SOX. a 29 AcSB’s standard setting process

Exercises

Item Description E1-30 Objectives of financial reporting. E1-31 Role of securities commissions and stock exchanges. E1-32 User needs. E1-33 Sources of GAAP. E1-34 Standard Setting. E1-35 Challenges facing financial reporting. E1-36 Stakeholders in the financial reporting environment.

MULTIPLE CHOICE—Conceptual

1. The essential characteristic(s) of accounting is (are) a. communication of financial information to interested persons. b. communication of financial information about economic entities. c. identification, measurement, and communication of financial information.…...

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