Sunday, June 3, 2007

Financial Accounting (2)

Accounting changes & Prior Period Adjustments


  • Estimate Changes... Current & Subsequent I/S will be affected

  • Principle Changes (GAAP to GAAP)... Restate prior period FS (if comparative FS)/ Restate RE (if not comparative FS) & Cumulative Effect should be shown

  • Entity Changes... Restate prior period FS only

  • Error Collection (non GAAP to GAAP etc.) ... Restate prior period FS (if comparative FS)/ Restate RE (if not comparative FS)

*GAAP means Generally Accepted Accounting Principles

This is one of the complication of financial matter. It is necessary to keep memorize it correctly.

2 comments:

Unknown said...

Hi, kiki. How are you?
Here I can see your effort which I admire so much!
As I mentioned here,

http://nn77.exblog.jp/d2007-06-12

it seems JGAAP is following USGAAP in the treatment of Accounting Changes.

BTW,
>It needs to keep memorize them correctly.

I would say, “It is necessary to memorize it correctly.”
Or I may well write “It needs to be memorized correctly.”
Please give me an email when things above aren’t clear enough.

Best regards,
nn

kiki8795 said...

Hi, nn! Thank you for visiting and leave some comments. I keep on writing the accounting matter in English.