Chapter 1

The income statement does not comprise:
1. Sales
2. Assets
3. Expenses
4. Profit
The notes to the financial statements do not comprise
1. An audit report
2. Significant accounting policies
3. Non-accounting information
4. Detailed information on the figures in the statement of financial position
The statement of financial position...
1. Gives a picture of the financial results of the company, of the complete financial year
2. Gives a picture of the financial position and investments of the company, of the complete financial year
3. Gives a picture of the financial position and investments of the company, at the last day of the financial year
4. Gives a picture of the financial results of the company, at the last day of the financial year
Financial accounting provides...
1. Budgets and forecasts of future business operations
2. Detailed management reports designed to control and manage company assets
3. Information on a company’s financial position to investors and creditors
4. All of the above are true
5. None of the above are true
IFRS is the abbreviation of...
1. Internal Financial Reporting System
2. International Financial Reporting Standards
3. Internal Financial Reporting Standard
4. International Financing and Reporting Standards
The International Financial Reporting Standards (IFRS) are issued by...
1. The International Accounting Standards Board (IASB)
2. The Financial Accounting Standards Board (FASB)
3. The International Federation of Accountants (IFAC)
4. The International Financial and Reporting Interpretations Committee (IFRIC)
The IAS Regulation of the European Commission requires the use of IFRS...
1. For all financial statements of European (EU) quoted companies as from 1 January 2003
2. For consolidated financial statements of European (EU) quoted companies as from 1 January 2003
3. For all financial statements of European (EU) quoted companies as from 1 January 2005
4. For consolidated financial statements of European (EU) quoted companies as from 1 January 2005
The following component is not part of the IASB structure:
1. The IASC Board
2. The IASC Foundation
3. The Standards Advisory Council
4. The International Federation of Accountants
Which of the following statements is least likely to be found in a corporate annual report?
1. Statement of forecasted earnings and cash flows
2. Notes to the accounts
3. Independent auditors’ report
4. Management commentary
5. Statement of financial position
The financial statement that reports changes in all components of shareholders’ equity is the...
1. Statement of cash flows;
2. Notes to the financial statements
3. Statement of changes in equity
4. Statement of comprehensive income
5. Management commentary
Which of the following is not an external user of financial statements?
1. Corporate management
2. National tax authorities
3. Shareholders
4. Trade creditors
Which of the following statements reports a company’s financial position as of a specific date?
1. Balance sheet
2. Statement of changes in equity
3. Income statement
4. Both a and b
5. All the above
The branch of accounting concerned with providing managers with information to facilitate the planning and control of business operations is called:
1. Auditing
2. Bookkeeping
3. Financial accounting
4. Management accounting
Which of the following would be classified as external users of financial statements?
1. Shareholders
2. The controller of the company
3. The CEO
4. The treasurer of the company
IFRS comprise:
1. Rules for accounting in financial statements
2. Rules for narrative disclosures in prospectuses
3. Rules for auditing financial statements
4. Rules for adjusting financial statements for taxation purposes
Which of the following is not included in the IASB’s due process?
1. Exposure draft
2. Discussion paper
3. Research proposal
4. Budget approval
5. Public comments
hich of the following is not an objective of the IASB?
1. The development of a single set of global accounting standards
2. Setting standards which will produce high-quality financial information to help participants in capital markets to make economic decisions
3. Enforcing the application of its standards
4. Working for harmonization of accounting and reporting standards around the world

Chapter 1

Quiz