Question
You are working for Harper LLP, an accounting consulting firm, as a research and accounting specialist. Your client is a bank (financial institution) and has
You are working for Harper LLP, an accounting consulting firm, as a research and accounting specialist. Your client is a bank (financial institution) and has asked you to research and explain the U.S. GAAP rules for some accounting transactions. The client wants you to reference and explain the rules in the FASB codification for this topic. The client will then use your business professional memo to look up the rules in the codification. Please make sure you include in your memo discussion about all three items (a) to (c) below. Reference the relevant topic, subtopic, section and paragraph(s). You should reference the codification by using FASB ASC XXX-XX-XX-XX. Your grade will primarily focus on whether you are identifying the proper topics, subtopics, sections and paragraphs in the codification. If you do not get all the way to identifying the specific paragraphs that are most relevant, you will lose points. You can summarize each reference in 1-2 sentences. You should not be copying any of the codification into your memo as the client can go look directly at the codification reference. a.The client has purchased numerous debt securities. They are unsure how to classify each security on their balance sheet and how to account for these transactions. Determine the reference(s) from the codification system that explain(s) the GAAP guidance on this topic. b.The bank has determined that some of their debt securities have suffered impairment losses. They are unsure what information needs to be disclosed in regards to these losses. Determine the reference(s) from the codification system that explain(s) the GAAP guidance on this topic. c.The company is preparing their cash flow statement. They do not know where to incorporate the purchase or sale of debt securities (operating, investing or financing section). Determine the reference(s) from the codification system that explain(s) the GAAP guidance on this topic.
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