Question

31. Which of the following is not a significant challenge related to valuation issues for audits of

merger and acquisition transactions?

a. Valuing the assets upon acquisition.

b. Valuing the liabilities upon acquisition.

c. Measuring restructuring charges.

d. Measuring the qualifications of personnel from the acquired company.

26. The FASB standard on accounting for leases issued in 2016 requires most leases to be reported

on the lessee’s balance sheet, which is a significant change from the previous accounting

requirements.

a. True

b. False

Answer 1

Ans 31:- D. Measuring restructuring charges is not a significant challenge related to valuation issues for audits of merger and acquisition transaction as restructuring charges is one time charges that has to be paid by the company for merger and acquisition. Companies restructure their operation for the improvement and efficiency of the company.

Ans 26: True The Financial Accounting Standards Boards issued updated Accounting Standards to improve Financial Reporting for lease transaction and therefore required to report on the lessee's balance sheet with the lease term of more than 12 months.