Financial Statements Prepared for Use in Other Countries 2205 the United States, the auditor may report using either (a) a U.S.-style reportmodiï¬ed to report on the accounting principles of another country (see para-graphs.09and.10)or(b)ifappropriate,thereportformoftheothercountry(seeparagraphs .11 and .12).
Retail Inventory Method. The retail inventory method is an accounting system to estimate the ending inventory and cost of goods sold. Essentially, its used to estimate the amount of ending inventory at cost.
Based on generally accepted accounting principles, the allowance method is preferred over the direct method, because it better matches expenses with sales of the same period and properly states the value for accounts receivable.