If your company is not a venture issuer, provide an analysis of your company’s critical accounting estimates. Your analysis should
(a) identify and describe each critical accounting estimate used by your company including
(i) a description of the accounting estimate;
(ii) the methodology used in determining the critical accounting estimate;
(iii) the assumptions underlying the accounting estimate that relate to matters highly uncertain at the time the estimate was made;
(iv) any known trends, commitments, events or uncertainties that you reasonably believe will materially affect the methodology or the assumptions described; and
(v) if applicable, why the accounting estimate is reasonably likely to change from period to period and have a material impact on the financial presentation;
(b) explain the significance of the accounting estimate to your company’s financial position, changes in financial position and financial performance and identify the financial statement line items affected by the accounting estimate;
(c) [Repealed]
(d) discuss changes made to critical accounting estimates during the past two financial years including the reasons for the change and the quantitative effect on your company’s overall financial performance and financial statement line items; and
(e) identify the reportable segments of your company’s business that the accounting estimate affects and discuss the accounting estimate on a reportable segment basis, if your company operates in more than one reportable segment.
INSTRUCTIONS
(i) An accounting estimate is a critical accounting estimate only if
(A) it requires your company to make assumptions about matters that are highly uncertain at the time the accounting estimate is made; and
(B) different estimates that your company could have used in the current period, or changes in the accounting estimate that are reasonably likely to occur from period to period, would have a material impact on your company’s financial condition, changes in financial condition or financial performance.
(ii) As part of your description of each critical accounting estimate, in addition to qualitative disclosure, you should provide quantitative disclosure when quantitative information is reasonably available and would provide material information for investors. Similarly, in your discussion of assumptions underlying an accounting estimate that relates to matters highly uncertain at the time the estimate was made, you should provide quantitative disclosure when it is reasonably available and it would provide material information for investors. For example, quantitative information may include a sensitivity analysis or disclosure of the upper and lower ends of the range of estimates from which the recorded estimate was selected.