TRUE/FALSE
1.Rigid uniformity considers relevant circumstances.
2.Flexibility is an approach to the uniformity problem.
3.Flexibility applies to situations in which there are relevant circumstances and more than one possible accounting method exists.
4.Flexibility is not often used in generally accepted accounting principles.
5.Whenever possible, flexibility should be used in formulating accounting policy.
6.Finite uniformity should always be used in accounting for complex events.
7.Since the 1970s, the SEC appears to have shifted its emphasis toward informative disclosure rather than protective disclosure.
8.Lev advocated restricting disclosures to “good news” items only.
9.An organized disclosure policy that includes “bad news” is beneficial to all parties because uncertainty about the firm is reduced.
10.The SEC requires disclosure of both retrospective and prospective information in the Management’s Discussion and Analysis section of the annual report.
11.Signalling theory appears to be inconsistent with the advocacy of greater disclosure.
12.Management disclosures in the face of a major earnings surprise may take the form of conference calls with analyst or public announcements via news services.