Hii waiting for answer 5. Why must companies disclose their significantaccounting policies?a) Only if required by auditorsb) To comply with tax regulationsc) To fulfill full disclosure principled) When changing accounting methods

Explanation of Full Disclosure Principle: This is a fundamental accounting concept that requires…

Answered: 5. Why must companies disclose their…

Contemporary Auditing

11th Edition

ISBN:9781337650380

Author:KNAPP

Publisher:KNAPP

Chapter1: Comprehensive Cases

Section1.2: Lehman Brothers Holdings, Inc.

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4. Management accounting is primarily concerned with?a) Providing statutory information for external useb) Providing internal information for use by managementc) Providing tax advice for internal used) Providing financial information only for use by management
Explanation
If a company registered with the SEC justifies a change in accounting method as preferable under the circumstances, and the circumstances change, can that company switch back to its prior method of accounting before the change? Why or why not?
An audit opinion on tax basis financial statements is an example of an opinion on financial statements that follow a special purpose financial reporting framework. True or False True False
What accounting policies are disclosed in the notes accompanying a companys financial statements? Why is this disclosure important?
A special purpose framework that is a non-GAAP financial reporting framework, that employs either a cash, tax, regulatory, contractual, or other basis of accounting. For example, a tax basis of accounting is used to file an organization’s tax return for the period covered by its financial statements. After performing a special purpose framework as decribed above, what level of assurance is provided to the financial statements?
Answer this accounting theory
Accounting Tax Principle: Understanding the Basics In the realm of accounting, the Accounting Tax Principle serves as a fundamental guideline for recognizing and accounting for taxes in a manner that aligns with the accrual basis of accounting. This principle is rooted in the idea that taxes should be recognized and recorded in the financial statements in the period in which they are incurred, regardless of when the actual payment occurs. This approach ensures a more accurate representation of an entity's financial performance by matching expenses, in this case, taxes, with the revenue they help generate. Application of the Accounting Tax Principle: When applying the Accounting Tax Principle, businesses consider various types of taxes, including income taxes, sales taxes, and other levies imposed by governmental authorities. The principle guides organizations to reflect the tax liability on their financial statements during the period in which the taxable event occurs or when the…
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What is a contingency? Why are contingencies important to users of financial statements? What are the criteria for recording contingencies? Should companies record a liability for threatened litigation? Why or why not?

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5. Why must companies disclose their significant accounting policies? a) Only if required by auditors b) To comply with tax regulations c) To fulfill full disclosure principle d) When changing accounting methods