Evaluating the Quality of Financial Reports

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djbloom from Metro
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$1.00 Evaluating the Quality of Financial Reports

From Business: Finance
Due on Dec. 29, 2008
Asked on Dec 24, 2007 at 8:33:48PM

Q:
The following statements describe the annual report issued by Short Sheet Company for the fiscal year ended December 31, 2007.

A. The report was issued on October 1, 2008.
B. the balance sheet included management's estimates of the increased value of certain fixed assets during 2007.
c. Procedures used to calculate revenues and expenses were different for 2007 and for 2006 and earlier years.
D. Short's financial statements were audited by an accounting firm owned by the president's brother.
E. Some of the company's major liabilities were not included in the annual report.

For each statement, identify the qualitative characteristic that has been compromised.

Due December 29, 2007

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Neo from CLSU
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$8.00 Answer with Brief Explanation

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Posted on Dec 25, 2007 at 04:28:55PM

A:
Preview: ... the estimates required under the condition of uncertainty, such that assets or income are not overstated and liabilities or expenses are not understated. This attitude is often express in the statement “to anticipate no profits and provide for all probable and estimable losses”.

c. Procedures used to calculate revenues and expenses were different for 2007 and for 2006 and earlier years.
COMPARABILITY is b ...

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harry_uk from Cambridge University, London
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$10.00 Fully descriptive with statutory information

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Posted on Dec 25, 2007 at 06:48:20PM

A:
Preview: ... e ref ...

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nekodem from the Manchester Business School
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$1.00 an explanation and example for each of the statements

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Posted on Dec 07, 2008 at 4:48:26PM

A:
Preview: ... used. This is obviously biased since the management wants to obtain a certain result and might manipulate the number to achieve its goal.
For example is you want to rise the book value of your company you simply revalue the assets at a higher price.

c. Procedures used to calculate revenues and expenses were different for 2007 and for 2006 and earlier years.
This is important since the financial reports are most useful in evaluating performance if compared to pr ...

The full tutorial is about 381 words long .