International Convergence Of Test Bank + Answers + Chapter 3

International Accounting, 5e (Doupnik)

Chapter 3 International Convergence of Financial Reporting

1) According to Sir Bryan Carsberg, former IASC secretary-general, what is the most significant cost of accounting diversity?

A) The time expended by accountants to create multiple sets of financial statements conforming to different national standards

B) The cost of the IASB to regulate compliance with many national accounting standards

C) It may limit the effectiveness of the international capital markets

D) The resources used by countries in legislating different sets of accounting standards

Difficulty: 1 Easy

Topic: International Harmonization of Accounting Standards

Learning Objective: 03-01 Explain the meaning of convergence.

Bloom's: Apply

AACSB: Reflective Thinking

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2) From a practical standpoint, what is the goal of accounting standards harmonization?

A) Creating one set of standards used throughout the world

B) Reducing the conflict among national accounting standards

C) Producing accounting standards that are unique for each country

D) Forcing compliance with IASB regulations

Difficulty: 2 Medium

Topic: International Harmonization of Accounting Standards

Learning Objective: 03-01 Explain the meaning of convergence.

Bloom's: Apply

AACSB: Reflective Thinking

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3) De jure harmonization refers to the process of:

A) making accounting practices consistent across countries.

B) making accounting regulations consistent internationally.

C) resolving accounting differences through jury trials.

D) eliminating the need to have different accounting methods.

Difficulty: 2 Medium

Topic: International Harmonization of Accounting Standards

Learning Objective: 03-01 Explain the meaning of convergence.

Bloom's: Evaluate

AACSB: Knowledge Application

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4) De facto harmonization refers to the process of:

A) making accounting practices consistent across countries.

B) making accounting regulations consistent internationally.

C) resolving accounting differences through litigation.

D) creating one set of accounting standards.

Difficulty: 2 Medium

Topic: International Harmonization of Accounting Standards

Learning Objective: 03-01 Explain the meaning of convergence.

Bloom's: Apply

AACSB: Reflective Thinking

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5) Which of the following statements is true about accounting convergence?

A) Convergence is a synonym for harmonization.

B) Convergence is the opposite of standardization.

C) Convergence, unlike harmonization, takes place over a period of time.

D) Convergence means developing high-quality standards in partnership with national standard-setters.

Difficulty: 2 Medium

Topic: International Harmonization of Accounting Standards

Learning Objective: 03-01 Explain the meaning of convergence.

Bloom's: Apply

AACSB: Reflective Thinking

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6) Harmonization of accounting standards:

A) is the same as convergence of accounting standards.

B) always ensures resulting of comparable financial statements internationally.

C) forces accounting differences to be resolved through litigation.

D) refers to the reduction of alternatives while retaining a high degree of flexibility in accounting practices.

Difficulty: 2 Medium

Topic: International Harmonization of Accounting Standards

Learning Objective: 03-01 Explain the meaning of convergence.

Bloom's: Analyze

AACSB: Knowledge Application

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7) Which of the following statements is believed to be true about accounting convergence by proponents of convergence?

A) Convergence would not affect the feelings of nationalism.

B) Convergence is desirable because there is very little difference among capital markets in different countries.

C) Convergence would help to raise the quality of accounting practices internationally.

D) None of the above statements is true.

Difficulty: 1 Easy

Topic: International Harmonization of Accounting Standards

Learning Objective: 03-02 Identify the arguments for and against international convergence of financial reporting standards.

Bloom's: Apply

AACSB: Reflective Thinking

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8) Which of the following items is considered to be the most significant impediment to accounting convergence?

A) Nationalism

B) Lack of accounting knowledge

C) Language differences

D) High cost of convergence

Difficulty: 1 Easy

Topic: International Harmonization of Accounting Standards

Learning Objective: 03-02 Identify the arguments for and against international convergence of financial reporting standards.

Bloom's: Remember

AACSB: Knowledge Application

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9) In addition to the International Accounting Standards Committee (IASC), which of the following organizations was considered to be one of the two most important forces in efforts to harmonize accounting standards?

A) U.S. Financial Accounting Standards Board (FASB)

B) United Nations (UN)

C) North Atlantic Treaty Organization (NATO)

D) European Union (EU)

Difficulty: 1 Easy

Topic: Harmonization Efforts Through the International Accounting Standards Committee (IASC)

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Remember

AACSB: Knowledge Application

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10) It has been said that the addition of 10 new members to the European Union (EU) in 2004 is likely to significantly change the dynamics within the EU. What was the explanation given for this statement?

A) The EU is getting too large to manage effectively.

B) The members added in 2004 have very different political and economic traditions than the 15 members that joined before 2004.

C) The members added in 2004 have more economic power than the members that joined the EU between 1957 and 1995.

D) The purchasing power of the EU was weakened by the addition of additional members.

Difficulty: 2 Medium

Topic: The European Union

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Analyze

AACSB: Reflective Thinking

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11) Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia, and Slovenia joined the European Union in 2004. Besides membership in the EU, what do these countries have in common?

A) They share a common language.

B) They were members of the former Soviet bloc.

C) All were under the political control of Germany until the early 1960's.

D) They were former British colonies until after World War II.

Difficulty: 1 Easy

Topic: The European Union

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Analyze

AACSB: Reflective Thinking

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12) The "Fourth Directive" issued by the European Commission, which administers the European Union (EU), deals with which of the following?

A) Adoption of the euro as the currency used throughout the EU

B) Consolidated financial statements

C) Rules for valuation, disclosures requirements, and the format of financial statements

D) Authority of the European Commission to pass laws

Difficulty: 2 Medium

Topic: The European Union

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Evaluate

AACSB: Reflective Thinking

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13) The "Seventh Directive" issued by the European Commission is a statement to the European Union (EU) members concerning:

A) adoption of the euro as the currency used throughout the EU.

B) consolidated financial statements.

C) rules for valuation, financial statement disclosures, and financial statement format.

D) authority of the European Commission to pass laws.

Difficulty: 2 Medium

Topic: The European Union

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Evaluate

AACSB: Reflective Thinking

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14) In preparation for admission to the European Union, Hungary, Poland, and the Czech Republic passed new accounting laws based on EU Directives. How were these new laws different from their previous accounting laws?

A) The new laws are easier to enforce than the previous laws.

B) The new accounting regulations are written in English, whereas the earlier accounting standards were written in Russian.

C) The new laws are less flexible than their earlier accounting laws.

D) The new laws are market-oriented whereas their earlier accounting laws were Soviet-style.

Difficulty: 2 Medium

Topic: The European Union

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Apply

AACSB: Reflective Thinking

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15) Why did the European Commission stop issuing directives related to accounting in 1990?

A) The EU was leaving the formulation of accounting standards up to the IASC.

B) The European Commission had finished the task of formulating accounting standards for the European Union.

C) Accounting harmonization had been completed.

D) The Commission found that its directives were unenforceable.

Difficulty: 2 Medium

Topic: The European Union

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Analyze

AACSB: Knowledge Application

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16) The early (1973-1988) harmonization efforts of the International Accounting Standards Committee (IASC) created standards that have been described as a "lowest-common-denominator" approach. What was the effect of these first international accounting standards?

A) The IASC standards accommodated existing accounting practices in various countries.

B) Comparability of financial statements across countries was achieved.

C) It resulted in few companies being in compliance with IASC standards.

D) All of the above

Difficulty: 1 Easy

Topic: The "Lowest-Common-Denominator" Approach

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Remember

AACSB: Knowledge Application

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17) The second phase (1989-1993) of the IASC's efforts to harmonize accounting standards was aimed at: 

A) making international accounting standards more flexible.

B) creating greater financial statement comparability across countries.

C) adding new alternatives for accounting practices desired by the international community.

D) strengthening the enforcement power of the IASC.

Difficulty: 1 Easy

Topic: The "Lowest-Common-Denominator" Approach

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Remember

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

18) Which of the following is NOT an objective of the International Accounting Standards Board?

A) To establish worldwide uniformity of accounting practice

B) To develop a single set of enforceable global accounting standards

C) To promote the use and application of global accounting standards

D) To encourage convergence of national accounting standards and international accounting standards

Difficulty: 1 Easy

Topic: Creation of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Remember

AACSB: Knowledge Application

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19) Which of the following statements is true of the International Accounting Standards Board (IASB)?

A) The Board consists of 16 members.

B) The Board should contain 6 part-time members.

C) At least 13 members of the Board must have experience as auditors.

D) All members of the Board should be from a single country.

Difficulty: 1 Easy

Topic: The Structure of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Remember

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

20) Of the 16 members of the International Accounting Standards Board (IASB), how many work for the board on a full-time basis?

A) 8

B) 13

C) 10

D) 0

Difficulty: 1 Easy

Topic: The Structure of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Apply

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

21) To create an appropriate mix of members of the IASB, since 2012 the board includes:

A) eight auditors.

B) eight academic representatives.

C) four members of the FASB.

D) a diverse geographical balance of members.

Difficulty: 1 Easy

Topic: The Structure of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Analyze

AACSB: Reflective Thinking

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22) Who was the first chairman of the International Accounting Standards Board?

A) Sir Walter Raleigh

B) Sir David Tweedie

C) Sir Paul McCartney

D) Sir Bryan Carsberg

Difficulty: 2 Medium

Topic: The Structure of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Apply

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

23) The International Accounting Standards Board was preceded by:

A) the IOSCO.

B) the ASEAN.

C) the IASC.

D) the NRC.

Difficulty: 1 Easy

Topic: The Structure of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Apply

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

24) How many trustees of the IFRS Foundation will normally be senior partners of prominent international accounting firms?

A) 0

B) 2

C) 5

D) 10

Difficulty: 1 Easy

Topic: The Structure of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Apply

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

25) The IASB is organized under an independent entity called:

A) the SEC.

B) the AFL.

C) the IFRSF.

D) INTERPOL.

Difficulty: 2 Medium

Topic: The Structure of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Apply

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

26) Which of the following is NOT true of the due process followed by the IASB in formulating International Financial Reporting Standards?

A) A period of public comment is provided after discussion papers are prepared.

B) Standards are approved by a unanimous vote of the 16-member board.

C) Exposure drafts are published prior to taking a vote of the board.

D) National accounting standards and practices are studied before preparing exposure drafts.

Difficulty: 1 Easy

Topic: The Structure of the IASB

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Apply

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

27) What basis does the International Accounting Standards Board use in developing IFRS?

A) Detailed rules to govern accounting practice

B) A framework for deriving general principles

C) Typical tax laws of western nations

D) Exceptions or unusual circumstances that require special attention

Difficulty: 2 Medium

Topic: The Need for a Framework

Learning Objective: 03-03 Discuss major harmonization efforts under the IASC and IASB, respectively.

Bloom's: Apply

AACSB: Knowledge Application

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28) Why does the IASB believe that a principles-based approach to standard setting is superior to a rules-based approach?

A) Detailed guidance or rules encourage accountants to look for ways around the rules rather than trying to provide useful information.

B) Principles-based standard setting is less costly to undertake than rules-based standard formulation.

C) It is desirable to have all corporations in all countries using the same accounting practice.

D) A conceptual framework for standard setting has demonstrated to encourage the greatest economic development.

Difficulty: 2 Medium

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Apply

AACSB: Knowledge Application

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29) According to the IASB, what is needed for IFRS to work effectively?

A) Commitment from auditors to resist client pressures.

B) Professional judgment in the public interest on the part of companies and auditors.

C) Financial statement preparers must produce reports that faithfully represent all transactions.

D) All of the above are conditions for effective standards.

Difficulty: 3 Hard

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Analyze

AACSB: Knowledge Application

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30) Which of the following statements is true about the IASB's approach to accounting standard setting?

A) The IASB approach is very similar to the rules-oriented basis favored by the FASB in the United States.

B) The IASB uses a principles-based approach to standards formulation.

C) The IASB pronouncements have been called a "cookbook" of accounting standards.

D) The Sarbanes-Oxley Act requires the IASB to move toward the approach for standard setting used by the FASB.

Difficulty: 1 Easy

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Apply

AACSB: Knowledge Application

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31) The IASB's Framework for the Preparation and Presentation of Financial Statements (1989) establishes:

A) the required practices that should be followed by accountants in preparing financial statements.

B) the structure, content, and format of financial statements.

C) sanctions for failure to comply with the IASB standards.

D) the concepts to be used in formulating international accounting standards.

Difficulty: 3 Hard

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Evaluate

AACSB: Knowledge Application

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32) The IASB's Framework for Preparation and Presentation of Financial Statements (1989) implies that the most important group of users is:

A) government.

B) general public.

C) creditors.

D) investors.

Difficulty: 1 Easy

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Evaluate

AACSB: Knowledge Application

Accessibility: Keyboard Navigation

33) According to the Framework for Preparation and Presentation of Financial Statements of the IASB, which of the following is NOT required for asset recognition?

A) Control of the resource

B) Ownership of the resource

C) Future economic benefits

D) Reliable measurement of the cost or value of the resource

Difficulty: 1 Easy

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Apply

AACSB: Knowledge Application

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34) According to the Framework for Preparation and Presentation of Financial Statements of the IASB, what is the definition of income?

A) Assets minus liabilities

B) Revenue minus expenses

C) Increase in equity (other than from transactions with owners)

D) Inflow of resources with future economic benefit

Difficulty: 1 Easy

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Apply

AACSB: Knowledge Application

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35) Which of the following qualitative characteristics make financial statement information useful?

A) Relevance

B) Understandability

C) Reliability

D) All of the above.

Difficulty: 1 Easy

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Remember

AACSB: Knowledge Application

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36) Which of the following is true of assets?

A) Assets should be recognized only when it is probable that future economic benefits will flow to the enterprise.

B) Assets should be recognized when it is probable that an outflow of resources will be required to settle them.

C) Asset is defined as decrease in equity, other than from transactions with owners.

D) A resource must be owned for it to be recognized an asset of the enterprise.

Difficulty: 1 Easy

Topic: A Principles-Based Approach to International Financial Reporting Standards

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Apply

AACSB: Reflective Thinking

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37) What is the intent of IFRS 1?

A) To establish the guidelines for financial statement presentation

B) To provide the working definitions of accounting elements

C) To provide guidance on first-time application of IFRS

D) To provide the framework for setting international accounting standards

Difficulty: 1 Easy

Topic: Presentation of Financial Statements (IAS 1/IFRS 1)

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Evaluate

AACSB: Reflective Thinking

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38) What is the primary focus of IAS 1?

A) To establish the guidelines for financial statement presentation

B) To provide guidance to first-time adopters of IFRS issued by the IASB

C) To establish the framework of guidelines to be used by IASB in setting accounting standards

D) None of the above

Difficulty: 2 Medium

Topic: Presentation of Financial Statements (IAS 1/IFRS 1)

Learning Objective: 03-04 Explain the principles-based approach to setting accounting standards.

Bloom's: Evaluate

AACSB: Reflective Thinking

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39) In which of the following countries is the use of IFRS NOT allowed for domestic companies listed on its stock exchanges?

A) United Kingdom

B) Yugoslavia

C) Australia

D) United States

Difficulty: 1 Easy

Topic: Adoption of IFRS

Learning Objective: 03-06 Describe the support for, and the use of, IFRS across countries.

Bloom's: Apply

AACSB: Knowledge Application

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40) What language is used to develop the International Financial Reporting Standards (IFRS)?

A) French

B) German

C) English

D) Spanish

Difficulty: 1 Easy

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-06 Describe the support for, and the use of, IFRS across countries.

Bloom's: Remember

AACSB: Knowledge Application

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41) Which of the following groups is responsible for translating International Financial Reporting Standards into languages other than the official language of the IASB?

A) The International Accounting Standards Board

B) The International Accounting Standards Committee Foundation

C) The United Nations

D) The national accountancy bodies of individual countries

Difficulty: 2 Medium

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-06 Describe the support for, and the use of, IFRS across countries.

Bloom's: Apply

AACSB: Knowledge Application

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42) The IASB has permitted the translation of International Financial Reporting Standards (IFRS) into how many languages?

A) None. They are only written in the official language of the IASB.

B) More than 30

C) More than 100

D) Only six languages: Chinese, English, German, Japanese, Russian, and Spanish

Difficulty: 2 Medium

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-06 Describe the support for, and the use of, IFRS across countries.

Bloom's: Apply

AACSB: Knowledge Application

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43) What is the official language of the IASB?

A) English

B) French

C) Spanish

D) German

Difficulty: 1 Easy

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-06 Describe the support for, and the use of, IFRS across countries.

Bloom's: Remember

AACSB: Knowledge Application

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44) According to IAS 1, which of the following is the overriding principle that must be followed while preparing IFRS-based financial statements?

A) Going concern

B) Fair presentation

C) Revenue recognition

D) Comparative information

Difficulty: 2 Medium

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-06 Describe the support for, and the use of, IFRS across countries.

Bloom's: Apply

AACSB: Knowledge Application

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45) Which of the following statements is true of IFRS 1?

A) It does not permit the recognition of intangible assets in balance sheets.

B) After its issuance in July 2001, it has not been amended as of yet.

C) It deals primarily with fair value measurement of assets.

D) It provides exemptions to complying with IFRS in specific areas.

Difficulty: 3 Hard

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-06 Describe the support for, and the use of, IFRS across countries.

Bloom's: Apply

AACSB: Knowledge Application

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46) Which of the following statements is NOT a way in which a country might adopt IFRS?

A) By requiring all companies in that country to adopt IFRS.

B) By permitting foreign companies listed on domestic exchanges to adopt IFRS.

C) By force of IASB to adopt of IFRS.

D) By requiring domestic companies that list on foreign exchanges to adopt IFRS.

Difficulty: 2 Medium

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-07 Examine the issues related to international convergence of financial reporting standards.

Bloom's: Evaluate

AACSB: Reflective Thinking

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47) Which of the following is NOT a major concern related to convergence of international accounting standards?

A) The complicated nature of particular standards

B) The tax-driven nature of the national accounting regime

C) An overload of guidance on the first-time application of IFRS

D) IFRS language translation difficulties

Difficulty: 2 Medium

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-07 Examine the issues related to international convergence of financial reporting standards.

Bloom's: Apply

AACSB: Reflective Thinking

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48) In November 2007, which of the following organizations removed the requirement that foreign private issuers using IFRS reconcile their financial statements to U.S. GAAP?

A) IASB

B) EU

C) SEC

D) FASB

Difficulty: 1 Easy

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-08 Describe the current status of the IASB/FASB convergence project.

Bloom's: Apply

AACSB: Reflective Thinking

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49) What was the "Norwalk Agreement?"

A) A pledge between the Financial Accounting Standards Board in the U.S. and the IASB to make their reporting standards compatible.

B) A concession by the Financial Accounting Standards Board in the U.S. to adopt IFRS as soon as possible.

C) It is a treaty between the United States and the European Union to make their accounting standards converge.

D) It was an agreement signed in Norwalk, Connecticut in 2002 to make English the official language of the IASB.

Difficulty: 1 Easy

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-08 Describe the current status of the IASB/FASB convergence project.

Bloom's: Apply

AACSB: Reflective Thinking

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50) According to the Norwalk Agreement, the FASB will monitor:

A) all IASB projects.

B) IASB projects according to their level of interest in the topic.

C) no IASB projects, since the IASB is capable of self-monitoring.

D) only those projects dealing with internationally complex issues.

Difficulty: 1 Easy

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-08 Describe the current status of the IASB/FASB convergence project.

Bloom's: Apply

AACSB: Reflective Thinking

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51) What is the role of the liaison members of the International Accounting Standards Board?

A) To facilitate information exchange and cooperation between the FASB and the IASB

B) To eliminate the political influences on the IASB and national accounting bodies

C) To enforce adherence to the fundamental principles of the IASB

D) All of the above

Difficulty: 1 Easy

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-08 Describe the current status of the IASB/FASB convergence project.

Bloom's: Apply

AACSB: Reflective Thinking

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52) What is Anglo-American Accounting?

A) It is an association of British and American accounting regulatory agencies.

B) The accounting systems used in the United States, United Kingdom, and other English-speaking countries.

C) This refers to the basis used by the IASB to judge the appropriateness of international accounting standards.

D) All of the above are true.

Difficulty: 1 Easy

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-09 Explain the meaning of "Anglo-Saxon" accounting.

Bloom's: Apply

AACSB: Knowledge Application

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53) Which of the following statements is NOT true about Anglo-Saxon Accounting?

A) There is a strong reliance on professional judgment.

B) Financial reporting focuses on the firm with an investor orientation.

C) There is a strong emphasis on measurement of taxable income.

D) Principle of fair presentation is predominant in financial reporting.

Difficulty: 2 Medium

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-09 Explain the meaning of "Anglo-Saxon" accounting.

Bloom's: Evaluate

AACSB: Reflective Thinking

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54) Which of the following statements is NOT true about Anglo-Saxon Accounting?

A) There is a strong reliance on professional judgment.

B) There is an agreement on the interpretation of the principle of fair presentation.

C) There is a stronger emphasis on substance of reports rather than the form of reports.

D) Audits report on the adherence to the principle of fair presentation.

Difficulty: 3 Hard

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-09 Explain the meaning of "Anglo-Saxon" accounting.

Bloom's: Evaluate

AACSB: Reflective Thinking

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55) Which of the following is a difference between the U.S. and other Anglo-Saxon countries in terms of accounting standards?

A) The U.S. does not adhere to the "true and fair view" approach.

B) The U.S. is more private sector-oriented.

C) The U.S. always follows a conceptual framework when developing accounting standards.

D) The U.S. standards are becoming more rigid than the U.K. standards.

Difficulty: 2 Medium

Topic: International Financial Reporting Standards (IFRS)

Learning Objective: 03-09 Explain the meaning of "Anglo-Saxon" accounting.

Bloom's: Apply

AACSB: Reflective Thinking

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