All of the following statements regarding recognition of receivables under U.S.GAAP and IFRS are true except:
A)U.S.GAAP and IFRS have similar asset criteria that apply to recognition of receivables.
B)Receivables that arise from revenue-generating activities are subject to broadly similar criteria for U.S.GAAP and IFRS.
C)The realization principle under GAAP implies an arm's length transaction occurs.
D)GAAP refers to the earnings process and IFRS refers to risk transfer and ownership reward.
E)Differences arise mainly from industry-specific guidance under U.S.GAAP.

Question

Quizplus · Accepted Answer

The statement "GAAP refers to the earnings process and IFRS refers to risk transfer and ownership reward" is incorrect. In fact, both GAAP and IFRS recognize the importance of the earnings process and risk transfer in determining whether revenue and receivables should be recognized.

All of the Following Statements Regarding Recognition of Receivables Under