Chapter Revision HighlightsChapter 1: The Economic and Institutional Setting for Financial Reporting• Streamlined discussion of how and why international accounting standards are developed.• Explanation of the FASB Accounting Standards CodificationTM project.• Expanded description of the FASB Conceptual Framework. Chapter 2: Accrual Accounting and Income Determination• Revised discussion of alternative formats for presentingcomprehensive income.• Revised Global Vantage section that highlights key differences between other comprehensive income (OCI)components under IFRS versus U.S. GAAP.• Updated exhibits from company reports throughout thechapter.• Updated data displays on transitory earnings components(special or unusual items, discontinued operations, and extraordinary items).

Chapter 3: Additional Topics in Income Determination• Revised Global Vantage Point section that discusses key differences between IFRS and U.S. GAAP on revenue recognition with examples.• New discussion of FASB/IASB recent proposals on revenuerecognition.• Updated exhibits from company reports throughout the chapter.

Chapter 4: Structure of the Balance Sheet and Statement ofCash Flows• Revised Global Vantage section that highlights key differences in where certain transactions are reported on the cashflow statement under IFRS versus U.S. GAAP.• New problem material on IFRS versus U.S. GAAP cash flowstatement items.• Updated exhibits from company reports throughout thechapter.
Chapter 5: Essentials of Financial Statement Analysis• Added new discussion of cause-of-change analysis.• Updated exhibits from company reports throughout thechapter.• Moved discussion of bankruptcy prediction models from appendix to chapter itself.• Added new appendix on Segment Reporting.

Chapter 6: The Role of Financial Information in Valuationand Credit Risk Assessment• Updated existing exhibits from company reports throughoutthe chapter.

Chapter 7: The Role of Financial Information in Contracting• Updated examples throughout the chapter.

Chapter 8: Receivables• Updated the Global Vantage Point section on IFRS similaritiesand differences, and the implications of the FASB ExposureDraft on Financial Instruments.• Revised discussion on bad debt expense to be consistent withproposed ASU on Revenue Recognition.• Introduced a new allowance for doubtful accounts analysisusing Krispy Kreme.• Updated the troubled debt restructuring discussion regardingwhat constitutes financial difficulties and concession underASU 2011-02.• Updated existing company examples throughout the chapter.

Chapter 9: Inventories• Updated Global Vantage Point section on the differencesbetween U.S. GAAP and IFRS and added new casematerials.• Updated inventory method and LIFO reserve statistics.• Provided new examples of inventory write-offs and fraud.• Added Whole Foods inventory disclosures to tie to Chapter 5discussions.

Chapter 10: Long-Lived Assets• Updated and expanded Global Vantage Point section on thedifferences between U.S. GAAP and IFRS.• Expanded discussion of conceptual underpinnings of accounting for long-lived assets.• New impairment example using Krispy Kreme.• Streamlined discussion of difficulties associated with analyzinghistorical cost financial statements.• New Whole Foods example to tie to Chapter 5 examples.• Added and updated new problems and cases.• Updated web appendix on current value accounting for IFRSissues; available on www.mhhe.com/revsine6e.

Chapter 11: Financial Instruments as Liabilities• Updated Global Vantage Point sections on IFRS guidancefor liability presentation, long-term debt, hedge accounting,and contingent liabilities.• New section on loan guarantees and ASC 460.

Chapter 12: Financial Reporting for Leases• Updated Global Vantage Point section on the differences between U.S. GAAP and IFRS and the Exposure Draftsjointly developed by the FASB and the IASB.• Updated comparison of operating and capital lease obligationsby industry.• New Whole Foods example for illustrating constructive capitalization to tie to Chapter 5 examples.• Added and updated problems and cases tied to FASB/IASBExposure Draft and existing IFRS.rev25672_fm_i-xxiv.indd Page ix 29/01/14 2:18 PM f-500 /202/MH02028/rev25672_disk1of1/0078025672/rev25672_pagefilesx Preface

Chapter 13: Income Tax Reporting• Added discussion of how the Patient Protection and Affordable Care Act affected many companies’ deferred tax assetsand resulted in earnings charges when the law was enacted.• Added explanation of why deferred tax positions for acompany never reverse even though individual items doreverse.• Added discussion of deferred taxes and the cash flowstatement.• Updated exhibits from company reports throughout thechapter.

Chapter 14: Pensions and Postretirement Benefits• Updated Global Vantage Point section on differences between U.S. GAAP and IFRS.• Added new diagram of pension relationships.• Updated and redesigned presention of statistics on plan assets by plan type, assumptions, and funded status.• Revised analysis for GE by using 2012 information.• Added discussion of immediate recognition of actuarialgains.• Added new problems and cases.

Chapter 15: Financial Reporting for Owners’ Equity• New section on convertible debt that may be settled in cash.• Added new examples and updated existing examples of company disclosures.• Additional problem material on distinguishing equity fromdebt transactions.

Chapter 16: Intercorporate Equity Investments• Reorganized material on debt investments so that it all appears together in the appendix.• Reorganized material on purchase and pooling of interestsmethods so they appear together in the chapter itself.• Updated exhibits from company reports throughout thechapter.

Chapter 17: Statement of Cash Flows

• Added appendix showing a simple way to use Excel to derive cash flow statements.• Updated exhibits from company reports throughout thechapter.Appendix: Time Value of Money