Under GASB guidance when should an item be recognized on the face of the financial statements? Under whatconditions, would the GASB indicate that a note disclosure should accompany an item that has been recognized on thefinancial statements?

Question

Kenny Small

Business

6 March, 06:08

Under GASB guidance when should an item be recognized on the face of the financial statements? Under whatconditions, would the GASB indicate that a note disclosure should accompany an item that has been recognized on thefinancial statements?

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Answers (1)

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Kasen Huynh · Answer 1

If it satisfies the definition of an element and is also measurable with a high degree of reliability and accuracy

If there is a lack of clarity of any items found within the financial statement

Explanation:

According to the governing body the Governmental Accounting Standards Board, an item is only accepted in the face of a financial statement if it satisfies the characteristics of an element and must be measurable. The level of accuracy and reliability in these measures must also be high.

When there is any item found in the financial statement that lacks clarity, it is important to tag the statement with a note disclosure stating what is not clear to you. If this is done, the user is able to understand each items in the statement.