Case Analysis

To: Ida Wong From: unbiased senior auditor Re: Potential explanation issues take out Cars-R-Us Inc. (BCR) Overview Company land and Constraints BCR is currently a surreptitious smart set; thereof GAAP is not a legal constraint. However, the party should agree with GAAP beca intent BCR has intention to become populace in the futurean initial national offering (initial offering) is planned in the next fiscal yr according to the case fact. As a private connection, BCR sens handling ASPE to fairly speech their fiscal statements. Since they whitethorn go public, we would choose IFRS, as it is requirement for public companies in 2011. orphic accompany bay window use either ASPE or IFRS. However, because of the impending initial public offering, a significant investor whitethorn prefer IFRS compliant information. Thus, we preach BCR use IFRS to present their monetary information. In order to pass public through IPO, miscellaneous constraints should be met, especially the financial requirements. Here whitethorn trick up a problem. There exists electromotive force bias for BCR to compromise IFRS rules for the pursuit of strong lucre. Thus, a fortunate financial position of BCR can be indicated. Moreover, management may believe that a lingual rule of noneffervescent earnings pass on be the most inviting to authorization sh areholders and thence depart prefer accounting policies that smooth earnings.

Users and User Needs * BCR counselling BCR Management including Bill Valarian, CEO of BCR are the primary quill users of the financial information. They want to obtain an categoric audit eyeshot in order to meet their swear to take the company public in the future. * Potential Shareholders The potential shareholders will be enkindle in the success of the company (i.e. strong take in income and balance sheet) because this will be used to evaluate whether or not they should invest in the companys IPO in the future. Furthermore, the potential shareholders however have the financial statements as their source of information to diagnose their investment decisions and thus they will be...If you want to get a full essay, order it on our website: Ordercustompaper.com

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