Question 6 A company developed its own comprehensive basis of accounting and fully discloses that basis in notes to its financial statements. It combines elements of FASB standards with the tax basis of accounting and the FRF for SMEs. What is this basis of accounting considered to be?

• a) An unacceptable hybrid basis of accounting
• b) An other comprehensive basis of accounting
• c) An acceptable modification of the tax basis of accounting
• d) A special purpose framework

Question 7 Which of the following qualities does the FRF for SMEs describe as important to achieve relevance, but the FASB does not?

• a) Predictive value
• b) Reliability
• c) Timeliness
• d) Neutrality

Question 8 For which entities does the FASB claim its financial accounting standards are useful?

• a) All entities
• b) Only for large entities
• c) Only for publicly held entities
• d) Only for entities not covered by the FRF for SMEs

Question 9 Which method(s) of accounting for the expense associated with a pension plan does the FRF for SMEs not allow?

• a) Expense the contributions to a defined contribution plan.
• b) Expense the current year's contribution to a defined benefit plan.
• c) Expense the cost determined by an accrued benefit obligation for a defined benefit plan.
• d) Expense no amount for pension cost.