Financial Reporting and Debt Presentation Quiz

• All long-term debts that had to be recorded have been recorded and

• All accompanying explanations that had to be included in the financial statements are included

• Existence

Existence the long-term debts that are included in the financial statements on balance sheet at the balance date

Presentation

The long-term debts are neatly combined or split up and clearly described, and with relevant accompanying explanations in the context of the required system of financial reporting In the balance sheet of the annual report, also the debts to suppliers are mentioned with a balance of €3.505.453, but the debts to suppliers and trading creditors are not further explained in the accompanying explanation to the balance sheet. This leaves a gap of 3.5 million euros in the accompanying explanation to the balance sheet. A continued inspection is a way to obtain control information. The control is a negative control, because the accountant wants to establish new unknown data. This can be achieved by having a conversation with the business to get this unknown data.

Test your knowledge of recording long-term debts, including accompanying explanations, and presenting them in financial statements. Assess your understanding of the importance of existence and presentation of long-term debts in the context of financial reporting.