Required place the appropriate letter ag identifying

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Financial Accounting: The Impact on Decision Makers
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Chapter 1 / Exercise 1-13
Financial Accounting: The Impact on Decision Makers
Norton/Porter
Expert Verified
Required Place the appropriate letter (A–G) identifying each pro-nouncement on the line in front of the statement describingthe pronouncement.C1-2OrganizationsCertain organizations have been influential in the establish-ment of accounting principles. The following is a list ofabbreviations for several of these organizations, as well as alist of statements describing the organizations.A. IRSG. CASBB. APBH. FASBC. CAPI.PCAOBD. IASBJ.GASBE. SECK. AICPAF.FASACL. EITF1.First organization in United States to be givenauthority to issue pronouncements on account-ing procedures and practice. Issued AccountingResearch Bulletins.2.Establishes cost accounting standards for U.S.government contracts.3.Administers the provisions of the InternalRevenue Code.CA S E S00980_02_ch01_p0001-0035.qxd 11/17/08 4:15 PM Page 33
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Financial Accounting: The Impact on Decision Makers
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Chapter 1 / Exercise 1-13
Financial Accounting: The Impact on Decision Makers
Norton/Porter
Expert Verified
34Chapter 1 The Environment of Financial Reporting4.Helps establish internationally comparableaccounting principles.5.Establishes accounting standards for state andlocal governmental entities.6.Establishes generally accepted accounting prin-ciples in the private sector of the UnitedStates.7.Created by Congress in response to fraudulentaccounting practices.8.Responsible for advising the FASB about techni-cal areas, task forces, and other matters.9.Established 31 Opinions, many of which stillconstitute generally accepted accounting principles.10.Has legal authority to prescribe accountingprinciples and reporting practices for all corpo-rations issuing publicly traded securities.11.Professional organization for all CPAs in theUnited States.12.Develops consensus positions on the imple-mentation issues involving the application ofstandards.Required Place the appropriate letter (A–L) for each organization infront of the statement describing the organization. In addi-tion, write out the full name of the organization.C1-3Establishment of GAAPSince the late 1930s, three organizations have been primarilyresponsible for the establishment of generally acceptedaccounting principles in the private sector of the United States.Required Write a brief report that identifies the three organizationsand provides a brief chronological history of each, includingthe pronouncements issued that still constitute generallyaccepted accounting principles.C1-4Accounting PrinciplesAICPA AdaptedAt the completion of the DarbyDepartment Store audit, the president asks about the mean-ing of the phrase “in conformity with generally acceptedaccounting principles” that appears in your audit report onthe management’s financial statements. He observes that themeaning of the phrase must include more than what hethinks of as “principles.”Required1.Explain the meaning of the term “accounting principles”as used in the audit report. (Do not discuss in this partthe significance of “generally accepted.”)2.The president wants to know how you determine whetheror not an accounting principle is generally accepted.Discuss the sources of evidence for determining whether

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