Which of the following are issues when dealing with the financial statements of international firms? I) Many countries allow firms to set aside larger contingency reserves than the amounts allowed for Canadian firms.
II) Many firms outside Canada use accelerated depreciation methods for reporting purposes, whereas most U.S.firms use straight-line depreciation for reporting purposes.
III) Intangibles, such as goodwill, may be amortized over different periods or may be expensed rather than capitalized.
IV) There is no way to reconcile the financial statements of non-U.S.firms to GAAP.
A)I and II
B)II and IV
C)I, II, and III
D)I, III, and IV

Question

Quizplus · Accepted Answer

I, II, and III are correct because they highlight common issues when comparing international financial statements, such as differences in contingency reserves, depreciation methods, and treatment of intangibles. IV is incorrect because there are ways to reconcile non-U.S. firms' financial statements to Generally Accepted Accounting Principles (GAAP), such as through International Financial Reporting Standards (IFRS) adjustments.

Which of the Following Are Issues When Dealing with the Financial