10) Some contingencies/provisions are recorded, some are disclosed and some are not addressed in the financial statements. Please indicate for each cell in the first table below, whether the contingency would be recorded, disclosed, or not addressed in the financial statements. Also, IFRS and US GAAP differ in their treatment of contingent liabilities. Fill out the 2nd table below to highlight the differences between US GAAP and IFRS. Probable Reasonably Possible Remote US GAAP IFRS Estimable Definition of Probable Not Estimable Estimate in a Range Discounting Terminology

10) Some contingencies/provisions are recorded, some are disclosed and some are not addressed in the financial statements. Please indicate for each cell in the first table below, whether the contingency would be recorded, disclosed, or not addressed in the financial statements. Also, IFRS and US GAAP differ in their treatment of contingent liabilities. Fill out the 2nd table below to highlight the differences between US GAAP and IFRS. Probable Reasonably Possible Remote US GAAP IFRS Estimable Definition of Probable Not Estimable Estimate in a Range Discounting Terminology

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter4: Balance Sheet: Presenting And Analyzing Resources And Financing

Section: Chapter Questions

Problem 11Q

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Similar questions

The presentation of current and non-current liabilities in the statement of financial position (balance sheet): a. is shown only on GAAP financial statements. b. is shown on both a GAAP and an IFRS statement of financial position. c. is always shown with current liabilities reported first in an IFRS statement of financial position. d. includes contingent liabilities under IFRS.
With regard to reporting of contingent liabilities, U.S. GAAP and International Financial Reporting Standards (IFRS) differ in defining the term "probable". Which of the following is correct with regard to defining "probable"? Multiple Choice Under IFRS, "probable" means the chance of an event occurring is slight. Under U.S. GAAP, "probable" means the chance of an event occurring is slight but less than likely. Under IFRS, "probable" means an event is more likely than not to occur. Under U.S. GAAP, "probable" means an event is more likely than not to occur.
Which of the following is stated correctly? a. Current liabilities follow non-current liabilities on the statement of financial position under GAAP but non-current liabilities follow current liabilities under IFRS. b. IFRS does not treat debt modifications as extinguishments of debt. c. Bond issuance costs are recorded as a reduction of the carrying value of the debt under GAAP but are recorded as an asset and amortized to expense over the term of the debt under IFRS. d. Under GAAP, bonds payable is recorded at the face amount and any premium or discount is recorded in a separate account. Under IFRS, bonds payable is recorded at the carrying value so no separate premium or discount accounts are used.
Which of the following statements about IFRS and GAAP accounting and reporting requirements for the balance sheet is not correct? a. Both IFRS and GAAP distinguish between current and non-current assets and liabilities. b. The presentation formats required by IFRS and GAAP for the balance sheet are similar. c. Both IFRS and GAAP require that comparative information be reported. d. One difference between the reporting requirements under IFRS and those of the GAAP balance sheet is that an IFRS balance sheet may list long-term assets first.
Which of the following statements about IFRS and GAAP accounting and reporting requirements for the balance sheet is not correct? a. Both IFRS and GAAP distinguish between current and non-current assets and liabilities. b. The presentation formats required by IFRS and GAAP for the balance sheet are similar. c. Both IFRS and GAAP require that comparative information be reported.
Which of the following statements is true concerning contingent liabilities? a. Such liabilities should include obligations of known existence but of unknown amount. b. If the definite amount is involved, it is not a contingent liability. c. Such liabilities are generally reported and totaled with other liabilities to make up the liability section of most balance sheets. d. Such liabilities should include obligations known in amount but unknown in existence.
1. Define and briefly discuss a loss contingency. 2. What are the similarities and differences of the accounting treatment and financial statement reporting of a loss contingency between U.S. GAAP and IFRS? 3. As a manager, would you like to report a debt as a current or non-current liability if you had a choice? Explain. And under what kind of circumstances could a short-term obligation be reported as a non-current liability?
Explain the measurement principles for provisions in IAS No: 37, for " Provisions, Contingent Liabilities, and Contingent Assets".
These are obligations which exist on balance sheet date although their amount is indefinite. Is the answer Provision or Estimated Liabilities? After that, can you please explain further why?
True (t) or False (f) _____ Contingent liabilities should be recorded in the accounts if there is a remote possibility that the contingency will actually occur)
Access the FASB Accounting Standards Codification at the FASB website ( asc.fasb.org ) Required: Determine the specific citation for accounting for each of the following items: 1. If it is only reasonably possible that a contingent loss will occur, the contingent loss should be disclosed. 2. Criteria allowing short-term liabilities expected to be refinanced to be classified as long-term liabilities. 3. Accounting for the revenue from separately priced extended warranty contracts. 4. The criteria to determine if an employer must accrue a liability for vacation pay.
Which of the following is correct about contingent liabilities and provisions? The terms are interchangeable. A provision is based on an estimate while a contingent liability can be estimated reliably. A provision is disclosed in the statement of financial position while a contingent liability is disclosed in the notes. A contingent liability does not need to be disclosed in an entity's annual report.