Independent accountant involvement with interim financial information

Article Abstract:

The Securities and Exchange Commission (SEC) supports the expanded involvement of independent public accountants in the review of quarterly financial data of all public companies prior to their release to the public. With the objective of providing users of financial information with reliable data for decision-making, new regulations are being considered. However, the benefits of expanded requirements remain doubtful. There exists valid concern on such matters as delays in data release, overreliance on reports, audit and liability costs, performance of timely reviews, and changes in auditors. It is suggested that the broader objective of the accounting profession should focus on the development of continuously audited, on-line, real-time financial statements.

Regulation misc. commercial sectors, Laws, regulations and rules, United States. Securities and Exchange Commission, Corporation reports, Company reports, National Commission on Fraudulent Financial Reporting

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Present value of future work: is it zero?

Article Abstract:

The proposal of the Financial Accounting Standards Board (FASB) to use the present value method in the accounting of warranties and other assets and liabilities may be impractical to implement. This change in procedure from current generally accepted accounting principles (GAAP) requires additional consideration of the timing of customer claims and the proper interest rate to be used in warranty expense calculation. Examples presented show that the procedural change requires additional work for the accountant with little perceived benefit.

Methods, Usage, Accounting, Valuation, Financial Accounting Standards Board, Current value accounting

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Materiality guidelines for changes in accounting principles

Article Abstract:

Materiality levels for changes in accounting principles were determined by examining the financial disclosures of 163 firms included in the Moody's Industrial Index. Seven measures were used to calculate a median level for materiality thresholds commonly used. The medians derived provide a guideline for improving financial reporting. They may be used to supplement the rule of thumb judgments generally used by accountants.

Disclosure statements (Accounting)

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