PART I
Connor and Martin have heard that IFRS is used internationally for financial statements but they know very little about it. Since they will most likely be going public and expanding internationally in the near future, they are considering switching to IFRS from GAAP and would like more information. They also realize if they go public and expand their business, they will have to deal with some issues they have not had to deal with previously, such as interim and segment reporting. For their first request, they would like you to research the following topics:
1. What are the similarities between GAAP and IFRS?
2. What are the major differences between GAAP and IFRS?
3. What are the requirements for interim reporting under both GAAP and IFRS?
4. Are there any problems or issues associated with interim reporting?
5. What are the advantages and disadvantages of providing segmented reporting?
6. What are the requirements for segment reporting under both GAAP and IFRS? Include the definition of an operating segment.
Memorandum Mechanics should be as follows:
1. The body of the memorandum should be a professional presentation centered on clear and concise writing. The responses to the questions should be detailed, well researched, and specifically related to CMC's industry.
2. The memorandum itself does not have to be in APA format. However, you should have in-text citations and a reference page. Both of these items should be in APA format.
3. Use the FASB Codification and IFRS to address all technical accounting issues presented in the questions, being certain to reference the applicable sections of the Codification and IFRS in your report. You may quote directly from the Codification and IFRS as long as all direct quotes are included in quotation marks.
4. Any other sources used to support your responses should similarly be properly documented. You should have other crediblesources in addition to the Codification and IFRS. The following might be useful for research:
PART II
Last year, CMC recorded a deferred tax asset related to product warranties and a deferred tax asset related to accelerated depreciation. A 75% valuation allowance was also established. However, with an upcoming international expansion, Connor and Martin wonder if the company can now reduce or eliminate the valuation allowance. In addition, Connor and Martin are considering alternative financing arrangements for equipment to be used in the upcoming expansion. However, they have not used equipment leases in the past and would like more information. For their second request, they would like you to research the following topics:
1. What are the sources of income that may be relied upon to remove the need for a valuation allowance?
2. What are tax planning strategies? Could CMC possibly employ a tax-planning strategy to support reducing its valuation allowance?
3. How do IFRS differ from GAAP regarding accounting for income taxes? Are there any major issues?
4. What are the capitalization criteria for a capital lease?
5. What comprises the lessee's minimum lease payments? What is excluded?
6. How do IFRS differ from GAAP regarding accounting for leases? Are there any major issues?
Memorandum Mechanics should be as follows:
1. The body of the memorandum should be a professional presentation centered on clear and concise writing. The responses to the questions should be detailed, well researched, and specifically related to CMC's industry.
2. The memorandum itself does not have to be in APA format. However, you should have in-text citations and a reference page. Both of these items should be in APA format.
3. Use the FASB Codification and IFRS to address all technical accounting issues presented in the questions, being certain to reference the applicable sections of the Codification and IFRS in your report. You may quote directly from the Codification and IFRS as long as all direct quotes are included in quotation marks.
4. Any other sources used to support your responses should similarly be properly documented. You should have other credible sources in addition to the Codification and IFRS. The following might be useful for research: .
PART III
Due to the upcoming expansion and decision to possibly go public, CMC has been reviewing its operating policies. Connor and Martin are contemplating a change in the accounting for its equipment from the straight-line method to an accelerated method. However, they wonder how the company will report this accounting change and how it will affect their financial statements. For their third request, they would like you to research the following topics:
1. What are the categories of accounting changes?
2. What are the accounting and reporting guidelines for a change in accounting principle related to depreciation methods?
3. What are the conditions that justify a change in depreciation method, as considered by CMC?
4. If they proceed with the change in depreciation methods, how will it affect their balance sheet and income statement (in general)?
5. Assume they do go public and are registered with the SEC. If CMC justifies a change in accounting method as preferable under the circumstances, and the circumstances change, can they switch back to the prior method of accounting before the change? Why or why not?
6. How do IFRS differ from GAAP regarding accounting changes? Are there any major issues?
Memorandum Mechanics should be as follows:
1. The body of the memorandum should be a professional presentation centered on clear and concise writing. The responses to the questions should be detailed, well researched, and specifically related to CMC's industry.
2. The memorandum itself does not have to be in APA format. However, you should have in-text citations and a reference page. Both of these items should be in APA format.
3. Use the FASB Codification and IFRS to address all technical accounting issues presented in the questions, being certain to reference the applicable sections of the Codification and IFRS in your report. You may quote directly from the Codification and IFRS as long as all direct quotes are included in quotation marks.
4. Any other sources used to support your responses should similarly be properly documented. You should have other credible sources in addition to the Codification and IFRS. The following might be useful for research:
PART IV
Connor and Martin are extremely pleased with all of the technical information and research you have provided them thus far. They feel they understand IFRS much better in addition to having a greater technical grasp of GAAP. They have decided to go public and also expand internationally within the next two to three years. With making such bold moves, they are also seriously considering a switch to IFRS as their accounting standards for financial statements.
For your final project, they would like you to prepare a PowerPoint presentation that summarizes all the information you have gathered for them up to this point. In addition, they would like you to add at least two slides regarding GAAP and IFRS. They would like your opinion on reasons to stay with GAAP and also reasons to switch to IFRS. They are not asking for a recommendation, just additional information in order to help them make their decision.
Presentation Mechanics should be as follows:
1. The presentation should include a title slide and a References slide. It should have appropriate fonts, colors and graphics for a professional presentation.
2. The presentation itself does not have to be in APA format. However, you should have in-text citations and a reference slide. Both of these items should be in APA format as much as possible. Your sources and citations should come from your previous project submissions for the summarized information. However, you may introduce new sources and citations for the additional information requested if you wish.
Attachment:- corporate accounting project.rar