1. List three accounting issues that the firm must resolve. Call them Issues 1, 2 and3.
2. What are the alternatives available for Issue 1?
3. Which alternative do you recommend for Issue 1? Justify your answer.
4. What are the alternatives available for Issue 2?
5. Which alternative do you recommend for Issue 2? Justify your answer.
6. What are the alternatives available for Issue 3?
7. Which alternative do you recommend for Issue 3? Justify your answer.
8. What are two restrictions that are in place for the accounting policies that Cando may follow?
9. Are Cando's investments in line with its strategic goals?

Although ICL's investments have been mainly in private companies so far, the doctors are thinking of revising their investment strategy and investing in more public companies. They believe that the stock market is poised for recovery; therefore, they are planning to borrow some funds for investment purposes. The accountant is currently reviewing the above transactions in preparation for a meeting with the bank. The company has never prepared GAAP statements before but is considering doing so. The company has not decided which GAAP to follow (IFRS or ASPE). Instructions Adopt the role of the company's accountant and analyze the financial reporting issues. CA9.2 Cando Communications (CC) is a public company that owns and operates 10 broadcast television stations and several specialty cable channels, 10 newspapers (including the International Post), and many other non-daily publications. It has a 57.6% economic interest in Australia TV (in Australia) and a 29.9% interest in Ulster TV (in Northern Ireland). According to the notes to the annual financial statements, the company owns approximately 15% of the shares and all the convertible and subordinated debentures of Australia TV. The convertible debentures are convertible into shares that would represent 50% of the company's total issued shares at the time of conversion. In total, including the debentures, the investment in Australia TV yields a distribution that is equivalent to 57.5% of all distributions paid by Australia TV. CC has a contractual right to be represented on the board of directors and has appointed three of the board's 12 members. Although the company has tried to influence the decisions made by Ulster TV management, it has been unsuccessful and does not have any representation on the board of directors. Investments represent approximately $150 million (about 5% of total assets). Even though revenues were up by 15%, net income was only $8 million for the year, down from $50 million the prior year