Which of the following is not required to be disclosed in financial statements u

Question

Which of the following is not required to be disclosed in financial statements under nature of operations? A. Industries in which the entity operates. B. Major products or services. C. Major competitors. D. The relative importance of each industry in which the entity operates. Which of the following is not required to be disclosed in financial statements under nature of operations? A. Industries in which the entity operates. B. Major products or services. C. Major competitors. D. The relative importance of each industry in which the entity operates.

Explanation / Answer

As of my understanding Answer is Option C:Major competitors

REASON:

Notes to the financial statement present all such information which cannot be presented on the face of income statement, balance sheet, statement of cash flows and statement of changes in equity.

Disclosure is neccessary if an item is significant and needs to be reported to users of financial statements.In the given case all the options a,b,c,d can be disclosed if they are of such significant.But under nature of operations option A,B and D are considered to be disclosed as they belong to operations of entity

Financial statements should include a description of the major products or services the reporting entity sells or provides and its principal markets, including the locations of those markets. If the entity operates in more than one business, the disclosure should also indicate the relative importance of its operations in each business and the basis for the determination.Where as competitors are considered in nature of operations.

Thank you.

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