The Ultimate Accountants' Reference: Including GAAP, IRS and SEC Regulations, Leases, and More, Third Edition

813 Pages·2010·4.59 MB·English

by  Steven M. Bragg

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The Ultimate Accountants’
rd
Reference, 3 Edition
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The Ultimate Accountants’
rd
Reference, 3 Edition
I GAAP, IRS SEC R ,
NCLUDING AND EGULATIONS
L , M
EASES AND ORE
STEVEN M. BRAGG
JOHN WILEY & SONS, INC.
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CONTENTS
About the Author xxv
Preface xxvii
Part One Overview of Accounting and Its Role in
the Organization 1
1 Introduction 3
2 The Role of Accounting 7
2.1 TasksoftheAccountingFunction 7
2.2 RoleoftheAccountingFunction 8
2.3 ImpactofEthicsontheAccountingRole 10
2.4 AccountingJobDescriptions 12
2.5 Summary 16
Part Two Accounting Rules and Regulations 17
3 Standard-Setting Organizations 19
3.1 Introduction 19
3.2 TheCommitteeonAccountingProcedure 19
3.3 TheAccountingPrinciplesBoard 20
3.4 TheFinancialAccountingFoundation 20
3.5 TheFinancialAccountingStandardsBoard 20
3.6 PublicCompanyAccountingOversightBoard(PCAOB) 22
3.7 TheGovernmentAccountingStandardsBoard 22
3.8 AccountingStandardsExecutiveCommittee(AcSEC) 23
3.9 TheInternationalAccountingStandardsBoard 23
3.10 TheConvergenceofU.S.andInternationalAccountingRules 24
3.11 Summary 24
4 The Securities and Exchange Commission 26
4.1 Introduction 26
4.2 OverviewoftheSEC 26
4.3 OrganizationoftheSEC 27
4.4 EDGAR 31
4.5 TheSecuritiesActof1933 32
4.6 TheSecuritiesExchangeActof1934 32
4.7 ThePublicUtilityHoldingCompanyActof1935 33
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vi Contents
4.8 TheTrustIndentureActof1939 34
4.9 TheInvestmentCompanyActof1940 34
4.10 TheInvestmentAdvisersActof1940 35
4.11 RegulationFD 35
4.12 RegulationM-A 36
4.13 RegulationS-K 36
4.14 RegulationS-T 37
4.15 RegulationS-X(RequirementsforFinancialStatement
Reporting) 38
4.16 StaffAccountingBulletins 44
4.17 StaffAccountingBulletin99:Materiality 46
4.18 FormstobeFiledwiththeSEC 47
4.19 Summary 47
5 Laws Impacting Accounting 48
5.1 Introduction 48
5.2 Ethics 48
5.3 EmploymentEligibility 50
5.4 Garnishments 51
5.5 HealthInsurance 52
5.6 Pensions 53
5.7 Taxes 54
5.8 WagesandOvertime 56
5.9 OtherLawsImpactingAccounting 58
5.10 Summary 59
Part Three Accounting Reports 61
6 The Balance Sheet and Statement of Stockholders’ Equity 63
6.1 Introduction 63
6.2 UsesoftheBalanceSheetandStatementof
Stockholders’Equity 63
6.3 TheBalanceSheetFormat 64
6.4 AssetDefinitions 66
6.5 LiabilityDefinitions 67
6.6 Stockholders’EquityDefinitions 68
6.7 TheStatementofStockholders’EquityFormat 69
6.8 AccountingTreatmentofOffsetstoAssetsandLiabilities 69
6.9 CritiqueoftheBalanceSheet 70
6.10 Summary 72
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Contents vii
7 The Income Statement 73
7.1 Introduction 73
7.2 FormatoftheIncomeStatement 73
7.3 ExpensesListedintheCostofGoodsSold 75
7.4 ReportingEarningsperShare 76
7.5 TreatmentofGainsandLosses 77
7.6 TreatmentofAccountingChanges 77
7.7 TreatmentofDiscontinuedOperations 78
7.8 TreatmentofExtraordinaryItems 78
7.9 TreatmentofOtherComprehensiveIncome 79
7.10 TreatmentofPriorPeriodAdjustments 79
7.11 Summary 80
8 The Statement of Cash Flows 81
8.1 Introduction 81
8.2 OperatingActivities 82
8.3 InvestingActivities 82
8.4 FinancingActivities 82
8.5 TheFormatoftheStatementofCashFlows 83
8.6 ExemptionsfromtheStatementofCashFlows 84
8.7 PresentationofConsolidatedEntities 84
8.8 TreatmentofForeignCurrencyTransactions 84
8.9 Summary 84
9 Footnotes 86
9.1 Introduction 87
9.2 DisclosureofAccountingChanges 88
9.3 DisclosureofAccountingPolicies 88
9.4 DisclosureofAssetImpairments 88
9.5 DisclosureofBadDebtRecognition 89
9.6 DisclosureofBarterRevenue 89
9.7 DisclosureofBillandHoldTransactions 89
9.8 DisclosureofBusinessCombinations 90
9.9 DisclosureofCallableObligations 90
9.10 DisclosureofCapitalStructure 90
9.11 DisclosureofCashDepositsinExcessofFDICInsuranceLimits 91
9.12 DisclosureofCashRestrictions 91
9.13 DisclosureofChangeinReportedMethodofInvestment 91
9.14 Disclosure of Changes in Investment Fair Value after Balance
SheetDate 92
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9.15 DisclosureofCollateral 92
9.16 DisclosureofCollectiveBargainingAgreements 92
9.17 DisclosureofCommitments 92
9.18 DisclosureofCompensatingBalances 93
9.19 DisclosureofConsignmentRevenue 93
9.20 DisclosureofContingentAssetPurchaseObligation 93
9.21 DisclosureofContingentLiabilities 94
9.22 DisclosureofContinuedExistenceDoubts 94
9.23 DisclosureofContractRevenueRecognition 95
9.24 DisclosureofCustomers 95
9.25 DisclosureofDerivativeUseObjectives 95
9.26 DisclosureofDiscontinuedOperations 96
9.27 DisclosureofDividends 97
9.28 DisclosureofEarningsperShare 97
9.29 DisclosureofEmployeeStockOwnershipPlan 97
9.30 DisclosureofEmploymentContractLiabilities 98
9.31 DisclosureofErrorCorrections 98
9.32 DisclosureofGainContingencies 98
9.33 DisclosureofGainorLossonanAssetSale 99
9.34 DisclosureofGeographicRisk 99
9.35 DisclosureofGoodwill 99
9.36 DisclosureofIncomeTaxes 100
9.37 DisclosureofIncreaseinValueofaWritten-down
Held-to-MaturityInvestment 100
9.38 DisclosureofIndustryRisk 100
9.39 DisclosureofInstallmentSales 101
9.40 DisclosureofIntangibles 101
9.41 DisclosureofInventory 101
9.42 DisclosureofInvestmentRestrictions 101
9.43 DisclosureofInvestments 102
9.44 DisclosureofLeaseTerminationCosts 103
9.45 DisclosureofLeasesbyLessees 103
9.46 DisclosureofLifeInsuranceProceeds 104
9.47 DisclosureofLitigation 104
9.48 DisclosureofLoanAcceleration 105
9.49 DisclosureofLoanExtinguishment 105
9.50 DisclosureofLoanGuarantees 105
9.51 DisclosureofLoanRestructuring 106
9.52 DisclosureofLoans 106