Accounting Expectations Gap and Financial Reporting Challenges
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Questions and Answers

What is one of the elements that consists of the IASB's thorough and transparent due process in establishing financial accounting standards?

  • An independent standard-setting board overseen by a geographically and professionally diverse body of trustees (correct)
  • Collaborative efforts with a single standard-setting body
  • A secretive process with limited stakeholder engagement
  • No evaluation of research or public responses

    • Which step is NOT part of the process followed by the IASB to develop a typical IFRS?

  • Public hearings are held on the proposed standard
  • Topics are identified and placed on the Board’s agenda
  • The Board evaluates research and public responses and issues an exposure draft
  • Final standard is issued without any evaluation (correct)

    • To reinforce the importance of an open, transparent, and independent due process, how many well-paid members make up the IASB?

  • 16 members (correct)
  • 8 members
  • 5 members
  • 20 members

    • What distinguishes the IASB from being part of any professional organization?

    <p>Autonomy and accountability only to the IFRS Foundation</p> Signup and view all the answers

    What is a key aspect of the collaboration process followed by the IASB in developing financial accounting standards?

    <p>Engagement with investors, regulators, business leaders, and the global accountancy profession at every stage</p> Signup and view all the answers

    What is NOT a characteristic of the IASB's membership?

    <p>Short 1-year terms for members</p> Signup and view all the answers

    Who supported the creation of the Accounting Standards Council (ASC)?

    <p>Professional Regulation Commission (PRC)</p> Signup and view all the answers

    How many members were there in the ASC?

    <p>Eight</p> Signup and view all the answers

    What is the role of FINEX in the ASC?

    <p>Representing financial executives responsible for financial statements</p> Signup and view all the answers

    Which standard-setting body was mentioned as a reference for the ASC?

    <p>International Accounting Standards Board (IASB)</p> Signup and view all the answers

    How do accounting principles become generally accepted in the Philippines?

    <p>Through substantial authoritative support from relevant parties</p> Signup and view all the answers

    What is the primary responsibility of PICPA within the ASC?

    <p>Setting accounting standards</p> Signup and view all the answers

    What is the expectations gap in accounting?

    <p>The difference between what the public thinks accountants should do and what accountants think they can do.</p> Signup and view all the answers

    Which of the following is NOT a significant financial reporting challenge facing the accounting profession?

    <p>Auditing financial statements.</p> Signup and view all the answers

    What complicates the process of ethical sensitivity and selection among alternatives in accounting?

    <p>Time pressure, job pressures, client pressures, personal pressures, and peer pressures.</p> Signup and view all the answers

    What does convergence to a single set of high-quality global financial reporting standards aim to achieve?

    <p>Greater comparability and transparency.</p> Signup and view all the answers

    What has been agreed upon by U.S. and European regulators regarding accounting standards?

    <p>Recognition of each other's standards for listing on world securities exchanges.</p> Signup and view all the answers

    How many votes are needed to issue a new IFRS?

    <p>Nine votes</p> Signup and view all the answers

    Which body issued 41 International Accounting Standards (IAS) that are now considered under the umbrella of IFRS?

    <p>IASC</p> Signup and view all the answers

    What is the purpose of the Conceptual Framework for Financial Reporting issued by the IASB?

    <p>To create a tool for solving financial reporting problems consistently</p> Signup and view all the answers

    Which pronouncement must be followed and is considered authoritative according to the text?

    <p>International Financial Reporting Interpretations</p> Signup and view all the answers

    How many International Financial Reporting Standards (IFRS) has the IASB issued to date?

    <p>13 standards</p> Signup and view all the answers

    Does the Conceptual Framework for Financial Reporting define specific standards for measurement or disclosure issues?

    <p>No, it does not</p> Signup and view all the answers

    How many members are in the Financial Reporting Standards Council?

    <p>15 members</p> Signup and view all the answers

    Who is required to be the Chairman of the Financial Reporting Standards Council?

    <p>A senior accounting practitioner</p> Signup and view all the answers

    How many representatives are there from the SEC in the Financial Reporting Standards Council?

    <p>1 representative</p> Signup and view all the answers

    Which organization is NOT represented in the Financial Reporting Standards Council?

    <p>DOF</p> Signup and view all the answers

    How many representatives are there from the accredited national professional organization of CPAs in public practice on the Financial Reporting Standards Council?

    <p>2 representatives</p> Signup and view all the answers

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