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Basic Question 4 of 13
What type of disclosure is required for the cumulative effect of a change in an accounting principle?
B. The company must disclose the effect in the footnotes to the financial statements only.
C. The company may not disclose the effect in the financial statements or notes because changes in accounting principles are common.
A. The company must show the effect in a separate section of the income statement on a net of tax basis.
B. The company must disclose the effect in the footnotes to the financial statements only.
C. The company may not disclose the effect in the financial statements or notes because changes in accounting principles are common.
User Contributed Comments 2
| User | Comment |
|---|---|
| shobes5150 | So A...and B? |
| Akiva | shobes5150 Answer B is incorrect because the word "only" in answer's phrase |
I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach
Learning Outcome Statements
describe the financial reporting treatment and analysis of non-recurring items (including discontinued operations, unusual or infrequent items) and changes in accounting policies
CFA® 2025 Level I Curriculum, Volume 2, Module 2.