ACCO 400 Study Guide - Final Guide: Issued Shares, Mci Inc., Current Value
12 Apr 2018
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Document Summary
Reports began to be external once shares issued. Accounting was unregulated until the great depression of the 1930s. Regulation required since companies were overvaluing their assets. Goal= insure investors provided with adequate & accurate info. Power to establish accounting standards but delegates this power to profession: strengthening in hc as many capital assets were overvalued before crash. Alternatives to hc developed over the years: current value, value in use: pv of future cfs, fv (mv): amt to be received/paid if firm disposed of asset/liability, mixed measurement. Market said to be working well when mv of assets/liabilities true value. Conceptual framework: basic concepts underlying financial reporting based on decision usefulness. Collapse of stock market late 1990s: enron. Expanded rapidly & needed large amounts of capital so attempted to raise capital without taking on debt. Created spes to which sold their own shares in return for receivable overvalued assets since receivable from own company.
