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The 2018 financial statements of
LVMH Moet Hennessey-Louis Vuitton
are presented in Appendix C at the end of this book. LVMH is a Paris-based holding company and one of the
world’s largest and best-known luxury goods companies. As a member-nation of the European Union, French
companies are required to prepare their consolidated (group) financial statements using International Financial
Reporting Standards (IFRS). After reviewing LVMH’s consolidated balance sheet in Appendix C, prepare
answers to the following questions:
a. Under U.S. GAAP, the balance sheet equation is defined as Assets = Liabilities + Shareholders’ Equity.
Describe how the balance sheet equation is defined under IFRS. Does the IFRS definition of the balance
sheet equation change the informational content of the consolidated sheet?
b. Under U.S. GAAP, current assets and current liabilities are listed before noncurrent assets and noncur-
rent liabilities. Describe the listing sequence of LVMH’s assets and liabilities. Does the listing sequence
impact the informational content of the consolidated balance sheet?