Notes Ch 2

Notes Ch 2 - Jorge Rossello Busi 100 Chapter 2 Notes I....

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Jorge Rossello Busi 100 Chapter 2 Notes I. Creating a Portrait of an organization a. Financial accounting information is rarely exact. b. Materiality: The magnitude of an omission or misstatement of accounting information that makes it probable that the judgment of a reasonable person relying on the information would have been changed or influenced by that omission or misstatement. c. Types of misstatements: i. Error : An unintentional misstatement of financial information. ii. Fraud : An intentional misstatement of financial information; it can result from misappropriation of assets (theft) or fraudulent financial reporting. d. If there are any material misstatements in financial information, the data can no longer be considered fairly presented. II. Dealing with Uncertainty a. Causes of uncertainty in reporting financial information i. Company is the subject of a lawsuit. Actual amount of money won/lost might not be known for years. ii.
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This note was uploaded on 04/26/2011 for the course BUSI 100 taught by Professor Unknown during the Spring '07 term at UNC.

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Notes Ch 2 - Jorge Rossello Busi 100 Chapter 2 Notes I....

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