Arrow Inc. has been using straight-line amortization for its capital assets for many years. Management is

considering a change to accelerated amortization but has concerns that this accelerated approach may cause confusion among some investors concerning the potential effects of the change on share prices.

Part A

Identify and explain the three conditions under which the change from straight-line amortization to accelerated amortization for capital assets willnothave an impact on Arrow's share price. (6 marks)

Part B

If Arrow is operating in an efficient market, explain whether it needs to present its financial information in a manner that everyone can understand. Discusstworeasons. (5 marks).