ACCT 7235 Study Guide - Final Guide: Credit Default Swap, Asset-Backed Commercial Paper, Matching Principle
Document Summary
1494 luca paciolo method of venice income and capital. 1700"s joint stock company (permanent existence, ll of shareholders, transferability of shares) Transition of purpose of accounting: companies act - need for audit profession, financial reporting regulation. 1930"s - great depression causes of crash sec created in 1934. Enron: needed capital and increased earnings, created spes financed by enron but not consolidated, m concealed debt, . 1b overstated equity, worldcom, 1999-2002, overstated b of earnings (b line costs, . 3b underst. of ada) Sox: create pcaob, restrict non-audit services, auditors report to committee, auditors independent directors, ceo/cfo certify fs, auditors certify internal control over fr. Describe the market meltdown (2007-08), fundamental questions and solutions, and what is relevant to accountants. Solutions: limit compensation of management in companies that encouraged off bs financing. Fs did not accurately reflect true value because left off siv debt and guarantees. Why is conservatism desired: definition gains/losses.
