The goal of financial reporting is to report financial information that is transparent and complete...

Question

The goal of financial reporting is to report financial information that is transparent and complete and truthfully report the financial performance of a company. Investors and other interested parties need to read and understand all aspects of financing reporting.
Use the Internet to research Verizon Communications’ financial statements, annual report, notes to the financial statements, president’s letter, and management discussion and analysis from the most recent year in order to complete this assignment.
Write a five to six (5-6) page paper in which you:

Discuss the disclosure requirement on accounting policies, and identify at least two (2) examples of the most commonly required disclosure. Explain the key ways in which the examples you provided are useful to financial statement users. Analyze Verizon Communications’ disclosure on accounting policies, and give your opinion on whether or not the information is helpful for decision making. Provide a rationale for your response.
Explain the importance of the management discussion and analysis section of an annual report. Select three (3) items from Verizon’s management and discussion analysis of the annual report that could be useful to potential investors. Provide three (3) specific examples of how the three (3) items you selected could influence a potential investor’s decision to invest in Verizon.
Describe segmented information, and explain the way in which companies determine segments. Identify at least three (3) advantages and three (3) disadvantages of segmented financial data. Give your opinion on whether or not the advantages outweigh the disadvantages. Outline the manner in which Verizon segments its financial data. Suggest key actions that Verizon’s management can take in order to improve the company’s segmented financial data. Provide a rationale for your response.

Analyze the various types of auditor’s reports, and determine the impact that the auditor’s report has on a company’s ability to obtain financing from a bank. Identify the type of auditor’s report issued on Verizon, and speculate the manner in which you believe banks will perceive Verizon’s auditor’s report.
Use at least two (2) quality academic resources in this assignment. Note: Wikipedia and other Websites do not qualify as academic resources.

Your assignment must follow these formatting requirements:

Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.
Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.

005_uidajo-omvevlab.docx

Robert · Accepted Answer

Running Head: FULL DISCLOSURE IN FINANCIAL REPORTING - VERIZON 1
Assignment Title 
Student Name 
Course Name 
Instructor Name 
Date
FULL DISCLOSURE IN FINANCIAL REPORTING - VERIZON 2 
Disclosure Requirements 
U.S. GAAP has proposed various disclosure requirements to the listed companies for 
enhancing the overall quality and reliability of the financial statement. It is essential to obtain an 
authentication about the implementation of various accounting policies is essential while 
presenting the financial statements. It is essential for the company to clearly mention and 
indicate about the accounting policies that they are using and must show the changes in the 
accounting policies in the annual report (CRWC, n.d.). 
Verizon Communications made a clear disclosure about all their critical accounting 
policies that makes the users understand the accounting policies used by the company. It is 
essential to understand all these information because it will enable the user to know what the 
accounting policies of the company are and they have disclosed all information as per their 
adopted accounting policies are not. Change in the accounting policies is mandatory to disclose 
because the change in accounting policies will cause more change to the financial statements that 
are difficult to ascertain without disclosure (CRWC, n.d.)  
In the annual report, there was a clear indication of the change in the recognition time of 
revenue that resulted in higher equipment revenue for Verizon. It makes the users understand the 
change in the equipment revenue of the company (Verizon, 2015, p. 14). Next is the clear 
disclosure about all the derivative trading and their outcome. There should be clear disclosure 
about all the derivative trading and hedging techniques used by the company in the financial 
statements. 
The main reason for emphasizing on this disclosure is that it is an area where most of the 
companies in the past have committed fraud. Therefore, it is mandatory for all the companies to 
disclose all details about their hedging and various positions in the derivative market. In the case 
FULL DISCLOSURE IN FINANCIAL REPORTING - VERIZON 3 
of Verizon Communications, they have made a detailed disclosure about the derivative trading 
their positions and the profit or loss generated from such transactions. It enables the user to 
understand the overall activities of the companies in the derivative market (Verizon, 2015, p. 46). 
It eliminates the opportunity for fraud and misrepresentation in the financial statements.  
Disclosing the method of accounting the derivatives is essential as they are complex and 
requires clear information. In this case, Verizon has provided detailed information about the way 
they account the derivatives. Similarly, they disclosed as for how these items are recognized in 
the statement that provides better insight into the values mentioned against the comprehensive 
income. It clearly described as how a change in the fair value is reported. These are crucial 
information for all the users in understanding the financial statement.  
Management Discussion and Analysis 
Management discussion and analysis forms an integral part of the financial report as it 
provides an in-depth information about the business, the strategy, crucial business dealings, 
business trends, overall performance of the business and position,

The goal of financial reporting is to report financial information that is transparent and complete and truthfully report the financial performance of a company. Investors and other interested parties...

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