A company's financial statements sometimes report significantly different results from year to year. This may be due to changes in economic circumstances, but it may also be due to changes in accounting methods or corrections of errors in recording past transactions. Changing the accounting method used can have a dramatic impact on a company's financial statements. This course provides a comprehensive overview of the accounting treatments and disclosure requirements pertaining to accounting changes and error corrections as stipulated in ASC 250 Accounting Changes and Error Corrections. It discusses the different types of accounting changes and error corrections and the related reporting implications within an entity's financial statements. Specifically, it includes excerpts from and references to ASC 250, interpretive guidance, and examples. It also provides insights from the Securities and Exchange Commission (SEC) staff.
Learning Objectives
After studying this course, you will be able to:
Identify the types of accounting changes
Recognize how to account for accounting changes
Recognize how different types of accounting changes affect the financial statements
Identify the steps involved in the required assessment for error corrections
Major Topics
Overview of ASC 250
Basic Principles
Accounting Treatment
Direct and Indirect effect of Retrospective Applications
Change in Accounting Estimate
Disclosure Requirements
Reporting the Correction
Use of Accounting Estimate
Change in Reporting Entity
Assessing the Materiality
