FAR5_Chap4 (part 1)

Early IASC standards often allowed a choice of accounting policy.

• True

• False

The role of IASB has been shifted from convergence to harmonization.

• True

• False

Main aim of IASB is to develop a set of high-quality financial reporting standards for global use.

• True

• False

The following bodies are appointed by IFRS foundation:

• IASB

• IASB working groups

• IFRS advisory council

• IFRS interpretation committee

The following are main issues in standard setting:

• Economic issues

• Social issues

• Political issues

• Global Conceptual Framework

From society’s perspective, firms should produce information until the marginal social benefit greater than marginal social cost.

• True

• False

Interest group theory assumes...

• firms face a mixture of private and regulatory incentives to produce information.

• objective of regulator is to maximize social welfare.

• regulator takes its own interests into account, while balancing demands of investors and managers.