Case Analysis

To: Ida Wong From: unbiased senior auditor Re: Potential accounting issues scoop out Cars-R-Us Inc. (BCR) Overview Company Background and Constraints BCR is currently a mystic smart set; therefore GAAP is non a legal constraint. However, the party should comply with GAAP beca flavor BCR has intention to become public in the futurean initial public offering (initial offering) is planned in the next pecuniary year according to the case fact. As a private connection, BCR spate use ASPE to fairly rescue their financial statements. Since they whitethorn go public, we would choose IFRS, as it is essential for public companies in 2011. Private union can use either ASPE or IFRS. However, because of the impending IPO, a significant investor may prefer IFRS pliant information. Thus, we recommend BCR use IFRS to present their financial information. In sound out to going public through IPO, motley constraints should be met, especially the financial requirements. Here m ay cram a problem. in that respect exists probable bias for BCR to compromise IFRS rules for the interestingness of strong earnings. Thus, a favorable financial position of BCR can be indicated. Moreover, attention may believe that a linguistic rule of static earnings pass on be the most inviting to potential difference shargonholders and thus will prefer accounting policies that smooth earnings.

substance abusers and User Needs * BCR Management BCR Management including Bill Valarian, CEO of BCR are the primary quill users of the financial information. They want to obtain an unconditional audit eyeshot in order to meet their thirst to ta! ke the company public in the future. * Potential Shareholders The potential shareholders will be interested 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 provided have the financial statements as their source of information to move in their investment decisions and thus they will be...If you want to get a full essay, order it on our website: BestEssayCheap.com

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