The founders of Oslo Group, Finn Elo and Venden Hakala, are about to realize their dream of taking their company public. They are trying to better understand the various legal and accounting issues they will face as a public company.
Accounting
a. What are some of the reporting requirements that their company will have to comply with when they offer securities to investors and creditors?
b. Identify the two entities that are primarily responsible for establishing IFRS, which will be applied when preparing their financial statements. Explain the relationship of these two organizations to one another.
Analysis
a. What is decision-usefulness?
b. Briefly describe how the financial statements that Oslo prepares for its investors and creditors will contribute to decision-usefulness.
Principles
Oslo will prepare its statements in conformity with IFRS. Finn and Venden have heard about an IFRS hierarchy. Briefly explain this hierarchy and advise them on how the hierarchy affects the application of IFRS.