Homburg Investment Inc is a real-estate development and property management company. Homburg is a publicly accountable enterprise that trades on both the Toronto Stock Exchange and the New York Stock Exchange. It holds a variety of properties in Canada, United States, and Europe. Some of its properties include residential condominiums, office buildings, industrial buildings, and shopping centres.

First Pro Shopping Centres, which operates under the banner "Smartcentres", is also a real-estate development and property management company. First Pro is a privately held company and holds properties in all regions of Canada with a concentration in the Ontario region. It is the leader in the widespread expansion of outdoor shopping malls in Canada.

Instructions

(a) One of the companies mentioned above prepares its financial statements using International Financial Reporting Standards (IFRS) while the other uses Accounting Standards for Private Enterprises (ASPE). Which company reports under IFRS? Why?

(b) Are the users of the financials statements of each company listed above different? Do you think this influences the type of accounting standards that each company uses?

(c) In light of your answer to (b) above, which company is more likely to have a sophisticated reporting system?

(d) Could either of the companies mentioned above maintain accounting records without using a journal or a ledger? Would this be efficient?