Reference no: EM132951635

Problem 1: Which of the following statements is FALSE in relation to regulation requiring the disclosure of financial information about an organisation?

a. Governments impose regulation so that those stakeholders with a financial interest in an organisation are less likely to receive reliable information about financial performance and are therefore less able to adopt strategies that safeguard their financial interests.

b. Governments throughout the world typically require larger organisations to prepare what are often referred to as 'general purpose financial statements', which are financial statements prepared in compliance with the many accounting standards that currently exist.

c. Regulating the financial disclosures that larger organisations are required to make helps to promote investors' confidence in capital markets.

d. Governments typically want people to have confidence in capital markets, as this will support economic growth.

Problem 2: Which of the following factors will influence the preparation of the balance sheet for larger organisations?

a. The application of accounting principles (these principles include the entity concept, the accounting period convention, the monetary unit convention, the going concern assumption, and the convention of accrual accounting).

b. Efforts taken to ensure that the financial information being presented satisfies the qualitative characteristics that useful financial information is expected to possess (which include the fundamental qualitative characteristics of relevance and representational faithfulness, as well as the enhancing qualitative characteristics of comparability, verifiability, timeliness and understandability).

c. Efforts to comply with the requirements embodied within accounting standards.

d. All of these choices.