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The initial impetus for lease capitalization was caused by concern over lessee balance
sheets.
Only firms that perform well have incentives to report their operating results.
Assessment measures are not concerned with particular attributes of objects.
SFAC No. 1 takes the position that users of financial statements must be assumed to be
knowledgeable about financial information and reporting.
The income statement is largely a legacy of fifty years of accounting standards based on
the revenue-expense approach.
It is difficult to attract investors to SPEs because the cash flows and the risks involved
are hard to predict.
The main problem standing in the way of newer information approaches is the
perceived competitive disadvantage of making public matters that management would
prefer to keep secret.
An event, as defined in SFAC No. 6 is, "a happening of consequence to an entity."
Most accountants believe that the method of cost allocation used is nothing more than
an arbitrary decision.
A problem with the increased importance of the management consulting function in
auditing firms is the possible erosion of the integrity of the auditing function.
In a ratio scale, the zero point implies "nothingness," or the absence of the quality being
measured.
The U.S. dollar orientation approach to the translation of foreign operations assumes
that foreign currency denominated assets, liabilities, revenues, and expenses are
measured in the foreign currency but are translated to U.S. dollars for reporting
purposes.
APB Opinions were originally expected to be based on in-depth research studies.
Accounting theory includes conceptual frameworks, accounting legislation, valuation
models, and hypotheses and theories.
Conservatism, materiality, and disclosure are examples of constraining principles.
APB Statement 4 and SFAC No. 5 indicate that liabilities are measured at amounts
established in the transaction, usually amounts to be paid it the future, but never
discounted.
