Podcast
Questions and Answers
Which of the following is NOT typically included in the notes to accounts?
Which of the following is NOT typically included in the notes to accounts?
- Income recognition method
- Depreciation policy
- Profit and loss statement (correct)
- Stock valuation method
Why are the significant accounting policies included in the notes to accounts?
Why are the significant accounting policies included in the notes to accounts?
- To hide financial information
- To confuse stakeholders
- To reduce transparency
- To provide further explanation of the financial statements (correct)
What does the basis of accounting refer to in the significant accounting policies?
What does the basis of accounting refer to in the significant accounting policies?
- Method of recognizing revenue
- Method of preparing financial statements (correct)
- Method of calculating income tax
- Method of valuing inventory
Why is it important for credit officers to compare significant accounting policies between companies?
Why is it important for credit officers to compare significant accounting policies between companies?
What does the stock valuation method determine?
What does the stock valuation method determine?
In which industries might income recognition methods like percentage of completion be relevant?
In which industries might income recognition methods like percentage of completion be relevant?
What role do notes to accounts play in comparing results between companies?
What role do notes to accounts play in comparing results between companies?
What could be a consequence if a credit officer neglects to note differences in accounting policies between companies?
What could be a consequence if a credit officer neglects to note differences in accounting policies between companies?
What critical information may a credit officer miss out on by not reading the directors’ report?
What critical information may a credit officer miss out on by not reading the directors’ report?
If a company is not publicly listed, is an activities report mandatory?
If a company is not publicly listed, is an activities report mandatory?
What is the purpose of an activities report according to the text?
What is the purpose of an activities report according to the text?
Under what circumstances can the CCM exempt certain classes of companies from appointing an auditor?
Under what circumstances can the CCM exempt certain classes of companies from appointing an auditor?
What type of information is included in the directors' report that is crucial for understanding a borrower?
What type of information is included in the directors' report that is crucial for understanding a borrower?
Which item is NOT typically listed in the directors' report?
Which item is NOT typically listed in the directors' report?
'Failure to read the directors’ report may result in missing out on critical information concerning:'
'Failure to read the directors’ report may result in missing out on critical information concerning:'
'What does an auditors’ report provide according to the text?'
'What does an auditors’ report provide according to the text?'
Who is the external auditor appointed to represent?
Who is the external auditor appointed to represent?
What are the three categories of private companies exempted by Practice Directive 3/2017?
What are the three categories of private companies exempted by Practice Directive 3/2017?
In some companies with major shareholders as directors, what may be perceived as weak or limited?
In some companies with major shareholders as directors, what may be perceived as weak or limited?
What does the audit report usually contain after each audit?
What does the audit report usually contain after each audit?
What is the purpose of the scope paragraph in the audit report?
What is the purpose of the scope paragraph in the audit report?
What type of opinion does an unqualified auditor's opinion state regarding a company's financial statements?
What type of opinion does an unqualified auditor's opinion state regarding a company's financial statements?
To whom is the audit report addressed?
To whom is the audit report addressed?
What role does the external auditor play in relation to a company's financial statements?
What role does the external auditor play in relation to a company's financial statements?
What type of assets does a non-current asset comprise according to the text?
What type of assets does a non-current asset comprise according to the text?
In the context of an airline business, what would be considered a non-current asset?
In the context of an airline business, what would be considered a non-current asset?
What is another term for non-current assets mentioned in the text?
What is another term for non-current assets mentioned in the text?
How are non-current assets classified by the auditor?
How are non-current assets classified by the auditor?
Which of the following is NOT an example of a non-current asset according to the text?
Which of the following is NOT an example of a non-current asset according to the text?
Why are non-current assets essential for a company's main business activities?
Why are non-current assets essential for a company's main business activities?
What could happen if a company loses a lawsuit related to its product?
What could happen if a company loses a lawsuit related to its product?
How might contingent liabilities impact a company's survival?
How might contingent liabilities impact a company's survival?
Why is it important for a credit officer to assess third-party guarantees?
Why is it important for a credit officer to assess third-party guarantees?
In what scenario might major outstanding financial obligations pose minimal risks to a company?
In what scenario might major outstanding financial obligations pose minimal risks to a company?
What role does non-financial information play in assessing a company's financial health?
What role does non-financial information play in assessing a company's financial health?
Why must the credit officer not ignore non-financial information in a company's annual report?
Why must the credit officer not ignore non-financial information in a company's annual report?
How can outstanding unrealised financial obligations impact a company if they are not commensurate with its core business activity?
How can outstanding unrealised financial obligations impact a company if they are not commensurate with its core business activity?
What could happen if third-party guarantees provided by a company fail?
What could happen if third-party guarantees provided by a company fail?
