Conceptual Frameworks And The Conceptual Framework

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To be able to say anything on the statement made by Hines in 1991, regarding the efficiency and working ability of the conceptual framework projects, it is imperative to have a clear idea about what exactly are conceptual frameworks and how they work. An argument to this statement can have both sides supporting and rejecting the use of conceptual framework project regarding its context and the time of their usage. In a situation, they might come in handy, in other they can prove to be completely useless by not meeting the generating accounting standard.

“A conceptual framework is a coherent system of concepts that flow from an objective. The objective identifies the purpose of financial reporting. The other concepts provide guidance on
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(Financial accounting book)
Aspiration is a very desirable derivative out of a sound framework project. Additionally, there are many benefits that can be derived from a good standard conceptual framework project. Along with helping to set out basis for more consistent accounting standards, it plays a part in avoiding conflicts between different standards. Credibility of the accountants and that the statements produced by them will increase with the help of framework projects. In the absence of some specific set standards, it helps the account makers to develop accounting policies. Furthermore, the people who set the standards are made more accountable and are enabled to show that a theory underpins their work. It is a very well understood fact by now that conceptual frameworks help to set out good standards for financial accounting and reporting. However, it is also essential to know the objective of financial reporting to be able to decipher the need of these frameworks more clearly. It is of concern that a coherent general financial report is generated for the external users who don’t have the privilege of looking in and inspecting any firm’s internal statements and information.

However, as it is said, every coin has two sides and every project have its own flaws too working alongside its qualities. Same is the case with framework projects. Even though it helps a handful by playing an important role in improving financial statements, there are certain flaws

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