Going Concern

In: Business and Management

Submitted By spgibson2
Words 4936
Pages 20
Going Concern

Group 4

ACCT 632, Advanced Financial Acct Theory

Liberty University

Aug 7, 2013

GOING CONCERN

Summary of Going Concern current exposure draft

Comparison and Contrast of current Going Concern theory and standards

1 Guidance provided by AU Section 341

2 Guidance provided by 17 U.S.C. §229.303

3 Proposed guidance of exposure draft

Comparison and Contrast of U. S. GAAP and IFRS with respect to Going Concern

1 Current Going Concern variations between U. S. GAAP and IFRS

2 Variations between proposed changes to Going Concern issues

The Benefits and Costs of a Going Concern Amendment

1 Providing preparer guidance

2 Making management responsible

3 Addressing investor concerns

Provisions in light of the FASB’s Conceptual Framework

1 Understandability

2 Decision usefulness

3 Relevance

4 Comparability

Response to Going Concern Exposure Draft

1 Proposed changes or corrections to the current exposure draft

References

Going Concern People go into business for many reasons, but no one goes into business with the expectation that they are not going to be successful. For that reason, acquisition is made for those assets that are needed to run the company with the understanding that there will be no need to arrange for early liquidation. Because there is no prediction to inform someone that their business may or may not make it, managers must rely heavily on accountants to ensure the basics are covered when dealing with financial reporting. A good start is to become familiar with the going concern assumption. The exposure draft was issued on June 26, 2013 in order to discuss amendments for accounting for assets and liabilities. “Under U.S. GAAP, financial statements are prepared under the presumption that a reporting entity will be…...

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