ExpertEasy1 markMultiple Choice
CPA · Question 37 · Area I: Financial Reporting
Which of the following is a required disclosure for a company reporting under US GAAP?
Which of the following is a required disclosure for a company reporting under US GAAP?
Answer options:
A.
Summary of Significant Accounting Policies
B.
Forecast of next year's earnings
C.
Names of all shareholders
D.
Details of every individual transaction > $1,000
How to approach this question
ASC 235 requires a Summary of Significant Accounting Policies (measurement bases, depreciation methods, inventory methods, etc.).
Full Answer
A.Summary of Significant Accounting Policies✓ Correct
A
The Summary of Significant Accounting Policies is a mandatory disclosure describing the accounting principles followed and methods of applying those principles (e.g., basis of consolidation, depreciation methods, inventory pricing).
Common mistakes
Confusing management discussion (MD&A) with financial statement notes.
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