Conceptual Framework (FAR)
Information depicts what it intends to represent. Consists of Free from Error, Neutrality, and Completeness
Faithful Representation
A general purpose financial reporting framework set forth by the FASB to be used for the preparation and presentation of financial statements.
Generally Accepted Accounting Principles (GAAP)
Foreign currency exchange rate on the date of a transaction.
Spot date
The actions taken by the auditor to obtain sufficient appropriate audit evidence in support of the conclusions on which the auditor's opinion is based
The currency in which a company maintains its books and records.
Local or Transactional Currency
Method of accounting for investment in equity securities that is applied when the investor can exercise significant influence over the investee but does not have control.
Equity Method
The amount of cash generated or used by the entity by engaging in its normal ongoing activities. Computed under either direct or indirect method.
Cash Flows from Operating Activities
Title and risk of loss transfer to the buyer when the common carrier arrives with the goods at the buyer's place of business.
FOB Destination
The three characteristics of fraud that are generally assumed to be present whenever a fraud scheme is successful. Consists of Reason/Motivation, Opportunity, and Rationalization.
Fraud Risk Triangle
Sending emails that appear to be from financial institutions or trustworthy entities in an attempt to get personal information for identity theft purposes.
Phishing
Understandability
Funds that must be spend for a specific purpose, or only after the occurrence of a specific event, or after a certain time, as stipulated by the donor.
Net Assets with Donor Restrictions
A system that uses physical counts to determine ending inventory amounts and determines cost of sales by formula.
Periodic Inventory System
Standards established by the GAO, also called "The Yellow Book," for auditors of governmental entities.
Generally Accepted Government Auditing Standards (GAGAS)
The minimum amount that may be considered market value in valuing inventory at the lower of cost of market, equal to its NRV less normal profit margin.
Floor
Having a more than remote but less than probable chance of occurring. Disclose but do not accrue.
Reasonably Possible
Funds established to account for resources set aside for the acquisition or construction of capital projects such as a building fund.
Capital Projects Funds
Providing or receiving goods or services without receiving or providing resources of comparable value in exchange.
Non-exchange transaction
A control deficiency, or combination of deficiencies, displaying at least a reasonable possibility that a material misstatement in financial statements will not be prevented or detected and corrected on a timely basis.
Material Weakness
A formal or informal agreement between two or more parties to do business together.
Partnership
An entity that is expected to be able to meet its obligations as they come due. Usually for at least one year.
Going concern
A business dealing between the acquirer and acquiree, the effects of which are eliminated when preparing consolidated financial statements.
Intercompany transaction
The amounts obtained by an entity in equity transactions with owners in excess of the par value.
Additional Paid-In Capital
A paragraph that does not modify the auditor's opinion and is added to the auditor's report, immediately after the opinion paragraph, to draw attention to something that is properly accounted for and disclosed but, in the auditor's judgement, should be brought to the attention of the FS users.
Emphasis-of-Matter Paragraph
An agreement between employer and employee to give the employee benefits in the form of a lump sum payment or an annuity upon retirement.
Pension