In: Accounting
1. . In addition to the financial statements and the accompanying notes, corporate annual reports normally include which of the following sections?
a- Management Discussion and Analysis
b- Report on Internal Control
c- Report on Fairness of the Financial Statements
d- All of these choices are correct.
2. Typical items included in the MD&A include all the following EXCEPT
a- management’s analysis and explanations of any significant changes between the current and prior years’ financial statements.
b- important accounting principles or policies that could affect interpretation of the financial statements, including the effect of changes in accounting principles or the adoption of new accounting principles.
c- management’s assessment of the company’s liquidity and the availability of capital to the company.
d- management’s assessment of the effectiveness of internal controls over financial reporting.
Answer 1-d. All of these choices are correct. | |||||||
In addition to the financial statements and the accompanying notes, corporate annual reports normally include the following sections: | |||||||
1. Management Discussion and Analysis | |||||||
2. Report on Internal Control | |||||||
3. Report on Fairness of the Financial Statements | |||||||
Answer 2-d. management’s assessment of the effectiveness of internal controls over financial reporting. | |||||||
Typical items included in the MD&A are: | |||||||
1. management’s analysis and explanations of any significant changes between the current and prior years’ financial statements. | |||||||
2. important accounting principles or policies that could affect interpretation of the financial statements, including the effect of changes in accounting principles or the adoption of new accounting principles. | |||||||
3. management’s assessment of the company’s liquidity and the availability of capital to the company. | |||||||
4. Significanty risk exposures that might affect the company. | |||||||
5. Any "off-balance-sheet" arrangements such as leases not included directly in the financial statements. |