Acct 302, First Db reply

What is a good response to.... One of the ways that financial information can fraudulently be reported to stakeholders is by overstating revenues. The motivation for this would be to show stakeholders that the company is exceeding expectations- or performing well. This can be done by recording revenues in a period they were not actually accrued in (like saying that revenues were earned before a product order was fulfilled), recording fictitious revenues, and even changing expenses to reflect incorrect periods or amounts. This “m” would be considered manipulation- because the accountant would be manipulating the financial statements (like the income statement) for potential personal gain. One case where this occurred was “last year involving Marvell Technology Group, the company was charged with pulling in sales from future quarters to close the gap between actual and forecasted revenue. The pull-ins amounted to as much as 16% of the company’s total quarterly revenues, according to the…

Economic consequences of accounting standard-setting means:a. standard-setters must give fi rst priority to ensuring that companies do not suffer any adverseeffect as a result of a new standard.b. standard-setters must ensure that no new costs are incurred when a new standard is issued.c. the objective of financial reporting should be politically motivated to ensure acceptance by thegeneral public.d. accounting standards can have detrimental impacts on the wealth levels of the providers of financialinformation.

b. Discuss the relative costs to the preparer and benefits to the users of financial statements of increased disclosure of information in financial statements.

Which of the following arguments supports the view that regulation is not necessary, particularly to the extent that it currently exists? Select one: a. Markets for information are not efficient and therefore produce a sub-optimum amount of information, given the problem of 'free riders'. b. Accounting information is like any other good, and people will be prepared to pay for it to the extent that it has a use. c. Investors need protection from fraudulent organisations that may produce misleading information. d. Information asymmetry exists because not everyone has the same power over resources to obtain the information they need.

a. It is impossible for an auditor to "guarantee" that a company's finanical statements are free of all errors because the cost to the company to achieve absolute accuracy (even if that were possible) and the cost of the auditor's verfication would be prohibitively expensive. How does the auditors' opinion recognize this absence of absolute accuracy? b. To what extent is the auditors' opinion an indicator of a company's future financial success and future cash dividends to stockholders?

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The auditor has determined that there is a material going concern uncertainty at the company due to their inability to comply with the requirements to refinance the company's debt. In addition, the company is suffering from losses and negative cash flows due to poor economic circumstances. The bank has refused to renew the company's borrowings and the directors now have no other option but to cease to trade. Inquiries of management have not revealed any practical plans or tangible solution to deal with the problem. Suppose that the financial statements have been prepared using the going concern basis of accounting but, in the auditor's judgment, management's use of the going concern basis of accounting in the preparation of the financial statements is inappropriate, what should be the opinion of the auditor in their report? a. Disclaimer Opinion O b. Adverse Opinion O c. Unqualified Opinion O d. Qualified Opinion

A company’s management has uncovered events that indicate that substantial doubt exists that the company can pay its debts as they come due over the following year. Management studies the plans created to address this risk. How can the company avoid disclosing that this substantial doubt exists? a. The plans must be reviewed by the chief financial officer. b. It must be probable that the plans will be implemented and it must be probable that the plans will mitigate the conditions that raised substantial doubt. c. Disclosure of the substantial doubt is required regardless of the availability of the plans. d. The plans must have been tested before the end of the financial year.

Answer the following question and provide detail examples to support your answer. Analyze and make an assessment of the International Accounting Standard Board's (ASB) Conceptual framework 2018 by highlighting its strength and flaws. Afterward, state how would improve it in order to further enhance the relevance and reliability of financial reporting.   2. a) Define the concept of research methodology in the context of accounting theory. Discuss the consequences of choosing an incorrect research methodology in accounting research, highlighting the strengths and limitations of quantitative and qualitative approaches to accounting research.  b) Evaluate the role of accounting theories in guiding research in the field of accounting. Discuss how different accounting theories, such as agency theory, positive accounting theory, and institutional theory, influence research questions, hypotheses formulation, and empirical analysis are from each other, highlighting their strengths and…

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Define materiality.  How does materiality come into play when assessing financial statement restatements?  Other than materiality, what is the one word that might be the most distinguishing factor between ethical earnings management and unethical earnings management?