Reference no: EM132794244

You are employed as a senior analyst in a private investment firm that focuses on companies in the information technology industry. The Chief Investment Officer (CIO) has asked you to compare and contrast Apple (www.apple.com) and the Samsung Group (www.samsung.com) as they intend on establishing a significant position in both stocks to capture the growth of the handset market and 5G wireless technology rollout. The investment team understands the competitive dynamics of the marketplace and the thesis for making the investment. You do not need to opine on the merits of the investment.

They need your expertise to identify the risks associated with making an investment in these two multinational companies from an accounting and reporting perspective. To minimize the investment risk, they will require you to report the results of Apple and the Samsung Group using the International Financial Reporting Standards (IFRS). The CIO has requested an executive summary outlining the specific risks associated with translating the locally issued financial statements of Apple and the Samsung Group to IFRS.

Your first step is to download a copy of the financial statements from the investor relations section of the website for Apple and the Samsung Group. At a minimum, you are aware the executive summary needs to include the following:

• A background on how the companies currently account for transactions
• An identification of the risks the investment firm will be exposed to related to the differences between local GAAP and IFRS
• A discussion of the recognition and measurement differences that exist between the local GAAP and IFRS
• Major differences related to disclosure and financial statement presentation
• Outlie the specific financial statement differences between IFRS and local GAAP for Apple and the Samsung Group
• Comment on issues related to debt agreements and IFRS