College 1 - Fair Value

Question 1 of 19

1

Barth (2018): Wat is accounting?

Select one of the following:

learned profession
informed economic reality
Accounting judgements requires objectief thinking to create useful information that can help decision-makers make better decisions
These decisions have consequences for economic reality and, thus, accounting purposes
This is the ‘information perspective’ on accounting, which has been a cornerstone of academic research for more decades
accounting is record-keeping and the creation of financial reports according to a set of rules.

Explanation

Question 2 of 19

1

Barker Schulte (2017), What is an institution?

Select one of the following:

agreed-upon means for creating rights and obligations
The use of an accounting basis is perhaps best perceived as a pattern of behaviour and our starting point is an institutional perspective of ‘understanding social behaviour as a historically informed development of rules of “appropriate” behaviour’.
a pattern of behaviour becomes finally routinised and fully taken-for-granted
institutions are mechanisms that facilitate efficient exchanges and interactions between economic
players
humanly devised constraints that shape human interaction’ (p. 3) that provide the ‘rules of the game in society’ (p. 3) where the actions of players (organisations) are governed by rules (institutions).

Explanation

Question 3 of 19

1

Georgiou Jack 2011, p.311: Wat is volgens deze artikel de Institutional approach?

Select one or more of the following:

The use of an accounting basis is perhaps best perceived as a pattern of behaviour and our starting point is an institutional perspective of ‘understanding social behaviour as a historically informed development of rules of “appropriate” behaviour’.
Institutionalisation: a pattern of behaviour becomes finally routinised and fully taken-for-granted
an institution is an agreed-upon means for creating rights and obligations among agents.
institutions are mechanisms that facilitate efficient exchanges and interactions between economic
players
Institutions influence organisational choices by defining which actions are suitable and supportable in an economy

Explanation

Question 4 of 19

1

North* (1990) Definition of institutions?

Select one or more of the following:

Humanly devised constraints that shape human interaction' (p. 3) that provide the 'rules of the game in society' (p. 3) where the actions of players (organisations) are governed by rules (institutions).
Institutions influence organisational choices by defining which actions are suitable and supportable in an economy
Economic welfare broadly refers to the level of prosperity and living standards of either an individual or a group of persons.
Economic Activity consists of all activities that generate Economic Value

Explanation

Question 5 of 19

1

Why do we have reporting standards?

Select one or more of the following:

Economic welfare broadly refers to the level of prosperity and living standards of either an individual or a group of persons.In the field of economics, it specifically refers to utility gained through the achievement of material goods and services. In other words, it refers to that part of social welfare that can be fulfilled through economic activity.
Economic Activity consists of all activities that generate Economic Value
Economic value creation is regulated to increase social welfare
In market economies, regulators are employed to guide this process
Capital allocation is only a small part of the broad economic process to
generate Economic Value
Capital allocation deals with selecting investments projects with positive Net Present Value
(NPV)
Accounting is only a small part of the economic value creation process
Acccounting Information provides information to facilitate Capital Allocation
Inputs: Expected cash flows
Outputs: Return on Investment
Managers respond to varying levels of rule precision by varying their earnings management attempts to minimize the chance their auditors will require adjustments.

Explanation

Question 6 of 19

1

Why do we have IFRS?

Select one or more of the following:

help eliminate barries to cross-border trading
Meer betrouwbare en transparante jaarrekeningen.
Eenvoudige vergelijkbaarheid
Stijging efficiënte markt.
Lagere kosten stijging kapitaal
Verbeterd de concurrentie en helpt met groei
Economische welvaart stijgt indien binnen een land regulatie sterk is met sterke instituties. Hierdoor stijgt ook de kwaliteit van de informatie.

Explanation

Question 7 of 19

1

Hoe creëren we High Quality accounting?

Select one of the following:

Hoge kwaliteit accounting = Hoge economische welvaart
Door audit af te schaffen
Meer conservatism in de jaarrekening
HQI heeft te maken met de volgende factoren: internal controls, incentives, auditing en standaarden.

Explanation

Question 8 of 19

1

How do accountants think about value?

Select one or more of the following:

Conservative: record reliable values: the best historical record >> Historical Cost Accounting (HCA)
Future oriented: provide relevant information: best estimate of present value of future benefits >> Fair Value Accounting (FVA)
Despite accounting standard setters advocating the increased use of fair value, not everyone is convinced that it is a legitimate conceptual basis for accounting.
Representation of economic ‘reality

Explanation

Question 9 of 19

1

Critical Question: How should we Implement IFRS Standards in Financial Reports to maximize economic
welfare for investors?

Select one of the following:

Economische welvaart stijgt indien binnen een land regulatie sterk is met sterke instituties. Hierdoor stijgt ook de kwaliteit van de informatie.
Conservatisme: Leg betrouwbare waarde vast. Het beste manier is historische kostprijs accounting

Explanation

Question 10 of 19

1

Nolder & Kadous (2018)p.2: Wat is professional skepticism?

Select one or more of the following:

Professional skepticism can be conceptualized as both a mindset and an attitude.
Mindsets consist of a collection of judgment criteria and cognitive processes and procedures to facilitate completion of a particular task (openness or receptivity to information and the extent to which they seek out confirming or positive information).
mindset conceptualization of professional skepticism captures the idea that information processing—in particular, critical thinking—is an essential component of skepticism.
Attitudes are evaluative responses associated with a
target.
exclude beliefs and feelings that drive individuals intentions and actions
Relevant targets for the attitude of professional skepticism are the financial statements

Explanation

Question 11 of 19

1

Attitudes are evaluative responses associated with a target. Include beliefs and feelings that drive individuals‘
intentions and actions.

Select one of the following:

True
False

Explanation

Question 12 of 19

1

Relevant targets for the attitude of professional skepticism are the financial statements (i.e., management's assertions) and the evidence.

Select one of the following:

True
False

Explanation

Question 13 of 19

1

Barker Schulte 2017, p.55: At the heart of the method of financial accounting is the balance sheet, which is a
representation of economic ‘objective’, in the form of a summary of the rights (assets) and obligations (liabilities)
of a reporting entity.

Select one of the following:

True
False

Explanation

Question 14 of 19

1

Georgiou & Jack (2011), p.311: Wat heeft volgens deze artikel IFRS veranderd?

Select one of the following:

IFRS heeft de de bestaande concept van historische kostprijs en stewardship veranderd en de standaarden zijn nu meer gericht op investeerder beslissingen en toekomstige kasstromen en fair value.
Ze focussen zich op de verandering naar fair value waardering. Hiermee wordt verandering van historische naar economische gerealiseerd. Hiernaast wordt ook de verandering van weergave economische realiteit bewerkstelligt.
The conceptual underpinnings of the standards move accounting practice away from established concepts of historical cost and stewardship towards concepts of investor decisions based on future
cash flows and fair values

Explanation

Question 15 of 19

1

Wat is het doel van artikel Georgiou & Jack (2011)?
Ze focussen zich op de verandering naar fair value waardering.

Select one of the following:

True
False

Explanation

Question 16 of 19

1

Barker & Schulte (2017), p.56: In this paper, we interpret the introduction of fair value measurement (FVM) in IFRS as a shift in metaphorical construct, from the historical to the economic, and so also as a shift in the accounting representation of economic ‘reality’.

Select one of the following:

True
False

Explanation

Question 17 of 19

1

Despite accounting standard setters advocating the increased use of fair value, everyone is convinced that it is a legitimate conceptual basis for accounting.

Select one of the following:

True
False

Explanation

Question 18 of 19

1

What is the Relation Financial Reporting Quality & Audit Quality?

Select one or more of the following:

managers respond to varying levels of rule precision by varying their earnings management attempts to minimize the chance their auditors will require adjustments
managers were more likely to attempt earnings management that were either structured to comply with precise standards or unstructured with respect to imprecise accounting standards
Auditors often compromise in client negotiations when accounting standards do not provide precise guidance
auditors are less likely to adjust earnings management attempts that were either structured to comply with precise standards or unstructured with respect to imprecise accounting standards
auditors are more likely to adjust earnings management attempts that were either structured to comply with precise standards or unstructured with respect to imprecise accounting standards
Auditors not compromise in client negotiations when accounting standards do not provide precise guidance

Explanation

Question 19 of 19

1

What is Economics instituions?

Select one of the following:

mechanisms that facilitate efficient exchanges and interactions
rules of the game in society
Economic welfare broadly refers to the level of prosperity and living standards of either an individual or a group of persons.
rules that facilitate efficient exchanges and interactions

	Created by Burak Baharli over 5 years ago

Master IFRS 2 Quiz on College 1 - Fair Value, created by Burak Baharli on 11/05/2019.

College 1 - Fair Value

Question 1 of 19

Barth (2018): Wat is accounting?

Select one of the following:

Explanation

Question 2 of 19

Barker Schulte (2017), What is an institution?

Select one of the following:

Explanation

Question 3 of 19

Georgiou Jack 2011, p.311: Wat is volgens deze artikel de Institutional approach?

Select one or more of the following:

Explanation

Question 4 of 19

North* (1990) Definition of institutions?

Select one or more of the following:

Explanation

Question 5 of 19

Why do we have reporting standards?

Select one or more of the following:

Explanation

Question 6 of 19

Why do we have IFRS?

Select one or more of the following:

Explanation

Question 7 of 19

Hoe creëren we High Quality accounting?

Select one of the following:

Explanation

Question 8 of 19

How do accountants think about value?

Select one or more of the following:

Explanation

Question 9 of 19

Critical Question: How should we Implement IFRS Standards in Financial Reports to maximize economic welfare for investors?

Select one of the following:

Explanation

Question 10 of 19

Nolder & Kadous (2018)p.2: Wat is professional skepticism?

Select one or more of the following:

Explanation

Question 11 of 19

Attitudes are evaluative responses associated with a target. Include beliefs and feelings that drive individuals‘ intentions and actions.

Select one of the following:

Explanation

Question 12 of 19

Relevant targets for the attitude of professional skepticism are the financial statements (i.e., management's assertions) and the evidence.

Select one of the following:

Explanation

Question 13 of 19

Barker Schulte 2017, p.55: At the heart of the method of financial accounting is the balance sheet, which is a representation of economic ‘objective’, in the form of a summary of the rights (assets) and obligations (liabilities) of a reporting entity.

Select one of the following:

Explanation

Question 14 of 19

Georgiou & Jack (2011), p.311: Wat heeft volgens deze artikel IFRS veranderd?

Select one of the following:

Explanation

Question 15 of 19

Wat is het doel van artikel Georgiou & Jack (2011)? Ze focussen zich op de verandering naar fair value waardering.

Select one of the following:

Explanation

Question 16 of 19

Barker & Schulte (2017), p.56: In this paper, we interpret the introduction of fair value measurement (FVM) in IFRS as a shift in metaphorical construct, from the historical to the economic, and so also as a shift in the accounting representation of economic ‘reality’.

Select one of the following:

Explanation

Question 17 of 19

Despite accounting standard setters advocating the increased use of fair value, everyone is convinced that it is a legitimate conceptual basis for accounting.

Select one of the following:

Explanation

Question 18 of 19

What is the Relation Financial Reporting Quality & Audit Quality?

Select one or more of the following:

Explanation

Question 19 of 19

What is Economics instituions?

Select one of the following:

Explanation

Critical Question: How should we Implement IFRS Standards in Financial Reports to maximize economic
welfare for investors?

Attitudes are evaluative responses associated with a target. Include beliefs and feelings that drive individuals‘
intentions and actions.

Barker Schulte 2017, p.55: At the heart of the method of financial accounting is the balance sheet, which is a
representation of economic ‘objective’, in the form of a summary of the rights (assets) and obligations (liabilities)
of a reporting entity.

Wat is het doel van artikel Georgiou & Jack (2011)?
Ze focussen zich op de verandering naar fair value waardering.