Deck 10: International Accounting

Question 1

Professional accounting societies first arose in the United Kingdom in the middle of the 19^th century.

Answer 1

True

Question 2

The continental model of financial reporting generally presents a strong accounting profession.

Answer 2

False

Question 3

The ASEAN is a group of developing nations in Southeast Asia whose goal is to foster trade and development both within and outside the region.

Answer 3

True

Question 4

The continental model of financial reporting generally reflects a strong governmental influence on accounting regulation.

Question 5

The Anglo-Saxon model of reporting features the use of judgment to make financial statements useful.

Question 6

Financial accounting standard setting in New Zealand has remained within the private sector.

Question 7

Countries following the continental model include most major countries of Western Europe as well as Japan.

Question 8

Harmonization of accounting standards refers to the degree of coordination or similarity among the various sets of national accounting standards and methods and the formats of financial reporting.

Question 9

The two general financial reporting models that have evolved in economically advanced countries are the Anglo-Saxon model and the European Model.

Question 10

Many continental model countries, such as France and Germany, have viewed harmonization as an opportunity to coordinate their accounting standards with those of the US.

Question 11

The key factor of difference between the Anglo-Saxon and continental models appears to be between capital-based financial markets and credit-based financial markets.

Question 12

The Netherlands is a continental nation with a largely Anglo-Saxon accounting model.

Question 13

The Accounting Standards Board (ASB) in the UK operates along the lines of the FASB.

Question 14

British standard setters blazed the trail of accounting regulation being centered in the private sector.

Question 15

In the United States, the term "present fairly" in opinions of American auditing firms is the same as the "true and fair view" of international financial reporting.

Question 16

The International Accounting Standards Committee was formed in an attempt at economic integration of member countries.

Question 17

The United States is not a member of the G4 +1.

Question 18

Within the continental model of financial reporting, Germany has the closest approach to a uniform national accounting system.

Question 19

Accounting may be called "the language of business."

Question 20

The Accounting Standards Steering Committee (ASSC) is the United Kingdom equivalent of the Securities and Exchange Commission.

Question 21

Which of the following characteristics does not describe the Anglo-Saxon model of financial reporting?

A)A strong accounting profession
B)Strong governmental influence
C)The importance of securities markets for raising equity capital
D)An emphasis upon the true and fair view of audited financial statements

Question 22

Which of the following statements are not required under Germany's accounting standards?

A)The Balance Sheet
B)The Income Statement
C)The Cash Flow Statement
D)All of the above are required

Question 23

Which of the following does not describe the continental model of financial reporting?

A)A weak accounting profession
B)Strong governmental influence
C)The primacy of investor needs over tax influences and creditor needs
D)Emphasis of debt financing over equity capital

Question 24

Which country has the oldest professional accounting organizations?

A)The UK
B)The US
C)France
D)Germany

Question 25

The European Union has extended consolidation accounting to firms within its member states under a very wide group of circumstances where one firm has substantive control over one or more other firms.

Question 26

Which of the following is a financial reporting model that features the presence of a strong accounting profession?

A)The Anglo-Saxon model
B)The continental model
C)The ASEAN model
D)The international model

Question 27

Which of the following terms is used to refer to harmonization among accounting practice of different enterprises?

A)Formal harmonization
B)Material harmonization
C)De jure harmonization.
D)Convergence

Question 28

The "true and fair view" refers to:

A)the use of judgment to make financial statements useful.
B)the same thing as "present fairly" in opinions of American auditing firms.
C)the fact that financial statements are in accordance with GAAP
D)the fact that financial statements are presented correctly in accordance with the law.

Question 29

The IASB has not yet promulgated a conceptual framework.

Question 30

Which of the following is a continental model country with some signs of moving toward the Anglo-Saxon view?

A)Germany
B)France
C)Canada
D)Japan

Question 31

Anglo-Saxon versus continental differences have been summarized using all but which of the following characteristics?

A)Strength of the accounting profession
B)Population size
C)Strong equity markets as opposed to credit financing from major banking institutions
D)The importance of the country's legal system relative to the setting of accounting rules

Question 32

Because of important national differences, a strong drive for harmonization of accounting standards has not yet been possible.

Question 33

Which of the following is true regarding the Accounting Standards Board (ASB) in the UK?

A)The US has a greater influence on the standard-setting apparatus in the UK than does the European Union.
B)ASB board members serve on a part-time basis without salary.
C)The Emerging Issues Task Force (EITF) serves both the US and the UK standards-setting boards.
D)The ASB issues accounting standards on its own authority.

Question 34

Which country has the closest approach to a uniform national accounting system?

A)The UK
B)The US
C)France
D)Germany

Question 35

Which of the following is true regarding American securities exchanges?

A)The US and the UK have a system of reciprocity in place for listing the securities on one another's stock exchanges.
B)The SEC does not allow foreign companies that do not use U.S. GAAP to be listed on American stock exchanges.
C)Most Japanese firms listed for trading on American securities exchanges use U.S. GAAP.
D)Canadian companies may list existing shares for trading on American stock exchanges, but may not list new stock issues.

Question 36

Financial reporting is independent of the legal system of a nation.

Question 37

The US is an example of:

A)the Anglo-Saxon model.
B)the continental model.
C)the ASEAN model.
D)the international model.

Question 38

Which of the following terms is used to refer to the harmonization present among the accounting rules of different countries?

A)Formal harmonization
B)De jure harmonization
C)Convergence
D)All of the above

Question 39

Principles-based standards are more highly detailed than rules-based standards.

Question 40

Which of the following countries is a continental nation, but more closely follows the Anglo-Saxon financial reporting model?

A)France
B)Japan
C)The Netherlands
D)Australia

Question 41

Harmonization of IASB and FASB standards is now being called:

A)benchmarking.
B)conformity.
C)uniformity.
D)convergence.

Question 42

Which of the following is a major difference between the IASB's conceptual framework and the FASB's conceptual framework?

A)The IASB prefers replacement cost over historical cost as a measurement basis.
B)FASB limits primary user groups to investors and creditors.
C)FASB's conceptual framework is considerably shorter than the IASB's.
D)The IASB's framework is in the form of a series of concept statements rather than a single framework.

Question 43

Which of the following organizations was formed in an attempt at economic integration, and has also been concerned with harmonization of accounting standard of its member nations?

A)The International Accounting Standards Committee
B)The International Federation of Accountants
C)The European Union
D)The International Organization of Security Commissions

Question 44

List five differences in accounting practices between the US and other countries.

Question 45

The IAS designation for the preferred accounting treatment is referred to as:

A)benchmarking.
B)conformity.
C)reconciliation.
D)convergence.

Question 46

Which of the following is not a true statement regarding the IASB?

A)The IASB has promulgated a conceptual framework.
B)The IASB is playing an important role in the drive toward harmonization.
C)Several European nations have surrendered their standard-setting powers to the IASB.
D)Members of the IASB have pledged to use their best endeavors to bring the adoption of IASB standards to their countries.

Question 47

Which of the following characterizes the United Nations involvement in financial reporting?

A)The UN has developed significant regulations relative to financial reporting for multinationals.
B)The US and the UK have expressed a desire to have the UN participate in developing qualifications to sit for professional accounting exams.
C)The UN has shown interest in prescribing an accounting curriculum.
D)The UN has had a greater role in establishing international accounting standards than the IASB.

Question 48

Which of the following possible measurement bases listed by the IASB in the most prevalent?

A)Present value
B)Exit value
C)Replacement cost
D)Historical cost

Question 49

The SEC drafted report required by Sarbanes-Oxley used which of the following terms to refer to a principles-based approach to standards?

A)Bright line standards
B)Rule-oriented standards
C)Objective-oriented standards
D)Systematic and rational standards

Question 50

Which of the following is true?

A)Convergence of IASB and FASB standards will be a major step towards international harmonization.
B)The IASB has reduced disclosure requirements.
C)The IASB has increased the allowed number of treatment in particular event areas.
D)FASB and the IASB have not yet committed to convergence of IFRS and U.S. GAAP.

Question 51

Compare and contrast the Anglo-Saxon financial reporting model with the continental model.

Question 52

Which of the following is not a member of the G4+1?

A)IASB
B)Australia
C)The US
D)France

Question 53

Benston, Bromwich, and Wagenhofer believe that the principles-based approach would work better in tandem with:

A)a fair value measurement orientation.
B)a revenue-expense orientation.
C)an asset-liability orientation.
D)all of the above.

Question 54

What does harmonization of accounting standards mean, and what are the two aspects of harmonization?

Question 55

Which of the following does not accurately characterize the IFAC?

A)It produces international financial reporting standards.
B)Its guidelines cannot be imposed on any member organization or nation.
C)Its board produces international standards for ethics, education, and public sector accounting.
D)It produces international standards for auditing and assurance.

Question 56

The term International Financial Reporting Standard (IFRS) refers to:

A)the new numbered series of pronouncements that the IASB is issuing.
B)
B)the entire body of IASB pronouncements, including International Accounting Standards issued between 1973 and 2001.
C)both a and
D)none of the above.

Question 57

Which of the following is not a true statement regarding harmonization of accounting standards?

A)Harmonization refers to the degree of coordination or similarity among the various sets of national accounting standards and methods and the formats of financial reporting.
B)Among the factors underlying the desire for harmonization is the rise in importance of the multinational firm.
C)The issue of harmonization is closely tied to the efforts of the IASB as well as activities of the EU.
D)Many continental model countries, such as France and Germany, have viewed harmonization as an opportunity to coordinate their accounting standards with those of the US.

Question 58

Identify the following organizations and describe the role each plays in the drive toward harmonization:
a.The IASB
b.The EU

Question 59

Contrast principles-based and rules-based accounting standards. Why do these approaches to standard setting tend to converge according to Schipper?

Question 60

Which of the following is a characteristic of rules-based accounting standards?

A)They are highly detailed.
B)They rely heavily on judgment by management or the auditor.
C)They are shorter than rules-based standards.
D)They are required by Sarbanes-Oxley.