ASC 280 is focused on providing information to users of financial statements tha
ID: 2554564 • Letter: A
Question
ASC 280 is focused on providing information to users of financial statements that can help them determine both the risks and the potential benefits that the entity can have. ASC 280 also discusses the concept of "enterprisewide disclosure" standards in order to aggregate information for end users of financial statements. Using the FASB Codification System, as your reference, investigate ASC 280 and explain how it can be useful to present information that may be relevant to the end user. From the ethical point of view, what would be the result if this type of information is omitted?
Explanation / Answer
Under FASB(Financial Accounting Standards Board), ASC 280 is a segmented reporting of financial statements, which is very useful for the end user, as it provides various information about the financial state of the entity.
If an entity omits to do ASC 280 reporting, it will bring a doubt about the company's policies, and it will eventually see a loss of credit in the market. It will lose its reputation in the marketplace, among all creditors, competitors, investors, customer, shareholders.