Once the FASB Has Established an Accounting Standard,the

question 5

Multiple Choice

Once the FASB has established an accounting standard,the

• A) standard is continually reviewed to see if modification is necessary.
• B) standard is not reviewed unless the SEC makes a complaint.
• C) task of reviewing the standard to see if modification is necessary is given to the AICPA.
• D) principle of consistency requires that no revisions ever be made to the standard.

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Definitions:

Private Placements

Securities sold directly to a small number of private investors, rather than through a public offering.

SEC Rule 144A

This SEC rule provides a regulatory framework that allows the sale of privately placed securities to qualified institutional buyers without the need for public registration.

Circuit Breakers

Mechanisms used in stock exchanges to temporarily halt trading on an exchange to curb panic-selling, triggered by drastic drops in value.

Flash Crashes

Rapid, deep, and volatile market declines, usually occurring within a very short time period, often caused by automated trading.