Question

According to the profession's ethical standards, which of the following events may justify a departure from a Statement of the Governmental Accounting Standards Board?

New Legislation, Evolution of a New form of Business Transaction

a. No, yes
b. yes, no
c. yes, yes
d. no, no

Answer 1

A departure from a Statement of the Governmental Accounting Standards Board may be justified in the event of new legislation or the evolution of a new form of business transaction.

Step-by-step explanation:

According to the ethical standards of the accounting profession, a departure from a Statement of the Governmental Accounting Standards Board may be justified in the event of new legislation or the evolution of a new form of business transaction.

For example, if new legislation is passed that changes the accounting requirements for government entities, it may be necessary to deviate from the previous standards in order to comply with the new law.

In addition, if a new form of business transaction emerges that is not covered by the existing standards, it may be necessary to develop alternative accounting guidelines to address the unique characteristics of the transaction.