Define and discuss "control" as defined by the FASB.

Expert Solution

FASB has Issued the revised definition of what constitutes the control of an entity. Under the current rules, the condition for controlling the financial interest has the ownership of the majority voting interest, unless the control is temporary and does not rest according to the ownership of the majority of voting interest. FASB's main goal is to provide the CPAs with better tools just for analyzing the complex corporate structures.

SOME PERSONS BELIEVE THAT THE REVISED ED ALSO GIVES CPAs the BETTER working definition of what constitutes the control than in 1995 ED, in which FASB did not approve. Observers mostly agree to the ED which will pass but does not all are certain they will solve the current problems.

THERE IS NO MORE GENERAL AGREEMENT THAT THE NEW standard is needed. Few companies may take unfair advantage of these current rules. Because the current standard also draws the bright lines, CPAs find them less subjective & are more comfortable. More of the subjective rules may create conflicts among the financial statement preparers and the auditors.

ekkarill92 answered 1 year ago

Find the FASB rules that define when one company is deemed to have control over a...

Find the FASB rules that define when one company is deemed to have control over a second one. Also find the rule that says at what level of stock ownership an investor is presumed to have significant influence over an investee.

Discuss "FASB and the New Leasing Standard"

Impulse control can be defined as an inability to control the desire for a substance or...

Impulse control can be defined as an inability to control the desire for a substance or act. The lack of impulse control is seen as a factor related to substance abuse but it is not the only factor. Research information on addictions and the two types of addictions (substance addictions and behavioral addictions). Choose one substance addiction and one behavioral addiction and answer the following: Describe each addiction including potential genetic and environmental factors leading to the addiction. Describe the...

Define fraud and internal control in detail. Identify the principles of internal control and define them....

Define fraud and internal control in detail. Identify the principles of internal control and define them. Give suitable examples

1. Define and discuss the several inventory control systems. 2. What is the purpose of inventory?...

1. Define and discuss the several inventory control systems. 2. What is the purpose of inventory? 3. What is the purpose of Internal Controls?

Define Inherent Risk and Control Risk, and discuss the relationship between these risks and audit risk...

Define Inherent Risk and Control Risk, and discuss the relationship between these risks and audit risk .

Define locus of control and distinguish between internals and externals. Discuss the relationship between locus of...

Define locus of control and distinguish between internals and externals. Discuss the relationship between locus of control and well-being and include evidence with regard to personal achievement and psychotherapy. (Highly Detailed)

(a) Define 'tests of control' and explain the importance of tests of control in the audit...

(a) Define 'tests of control' and explain the importance of tests of control in the audit of a company. (b) You are an audit senior in Asenso Boateng & Co a firm providing audit and assurance services. One of your clients is an exclusive hotel called 'Rock City Hotel' situated in the centre of Airport City Accra. As part of your audit procedures you are assessing the controls surrounding payroll. You have read last year's audit file and have obtained...

Find the FASB rules that define how to compute the goodwill (or gain on bargain purchase)...

Find the FASB rules that define how to compute the goodwill (or gain on bargain purchase) in a business combination. Then find the general rule that says goodwill should not be amortized. (You may look for the allowable alternative of amortizing goodwill, for private companies.)

Fill in the chart to define negative control and positive control in terms of how the...

Fill in the chart to define negative control and positive control in terms of how the active forms of the gene regulatory proteins function. How does an inducer turn on a gene that is negatively controlled? How does an inducer turn on a gene that is positively controlled? Explain how a product turns off a negatively controlled gene, and how it turns off a positively controlled gene. Provide an example of each. Type of control Function of Inducer Function of...

Question