The Conceptual Framework Of Financial Statements

Boundless (2015) said that a Conceptual Framework can be defined as a system of concepts and purposes that guide to the creation of a constant set of regulations and standards. Especially in accounting, the rule and standards set by the nature, function and limit of financial accounting and financial statements. IFRS(2015) stated that

Working with Financial Statements Accounting is the heart and soul of executing a successful business. Accounting is used to provide record for all items that are paid and received for a business over any period of time. Within the purpose of accounting lies the need to provide continuity and sustainability within a business, without it a business will not thrive. The information obtained is kept on record, in order to give insight to upper management on data concerning the daily revenue and expenses of that business. This data is needed to not only inform the employees of the business, but also the investing parties of that business as well. Success in business is equated to being accountable of all aspects of revenue and expenses. To

Ethics and Conceptual Framework Paper Conceptual Framework There are two major philosophies in accounting consisting of a principles-based system for accounting and a rules-based system for accounting. The following discussion will speak about these two philosophies and will define one as being a best fit for encompassing the role of ethics and

Income Statements – Income Statement, Balance Sheet, and Statement of Cash Flows Financial statements are very important for decision makers in the business world. They inform the firm’s owners, lenders and managers of the performance of the company and their employees. Standardized financial statements make for financial transparency between all businesses and sectors of business. Financial statements are important to companies not only to measure performance but to obtain capital through debt and equity. The main financial statements used by all companies, private and public, are the balance sheet, income statement (profit and loss statement), and statement of cash flows. Companies also use financial ratios to determine if they are performing to standards and are determine if they are increasing revenues sufficiently with the amount of expenses and debt taken on.

Should China Adopt International Accounting Standards? The International Accounting Standards Board (IASB) issued and developed the new International Financial Reporting Standards (IFRS) as new international accounting standards after 2001. In 2006, the Chinese government issued a new set of Accounting Standards for Business Enterprises (ASBE) which are substantially consistent with IFRS.

Introduction Keeping the day-to-day business accounting is not just a necessity but rather, and above all, an obligation. Financial accounting seeks to find answers to recurring questions in a business such as, how much was sold last month, how many people have used the services, and how much to produce to meet the needs of the customers. The financial accounting is a method that helps better organize and manage any business. Accounting is the science that serves to organize all the numeric records of a particular company. Thus, it serves to record all movements of values and quantities. Having said that, it is not difficult to understand that financial accounting is, above all, a tool for managing a business, regardless of its size.

Accounting has been around since the beginning of civilization and played an important role in the development of cities, trade and the concepts of wealth. Nowadays, business is very complex and therefore there is an increased need for providing accurate and reliable financial information. Moreover, according to ACCA’s beliefs, the importance of financial reporting and accounting standards is significant not only for the accountancy profession, but also for the world economy. [1] Dr Joe Sumners, Auburn University, defines economic

Although the four qualitative characteristics are the most important link between the accounting objectives and achieving the objectives, there are also some elements restrict them. To begin with, accounting information has dubious quality itself, which affects the understandability.

C H A P T E R O N E INTRODUCTION 1.1 BACKGROUND OF THE STUDY Accounting as a profession or discipline, has always been seen as an information-generating one, which fittingly makes the job of the Accountant to be that of observing economic activities, recording the observations in the prescribed books,

IASB FRAMEWORK The IASB framework was approved by the IASC Board in April 1989 and adopted by the IASB in April of 2001. They set out the perceptions that underlie the provision and presentation of financial statements. The concepts that underpin the presentation of the statements deal with following;

The International Financial Reporting Standards Foundation (IFRS) and the International Accounting Standards Board (IASB) replaced the International Accounting Standards (IAS) and the International Accounting Standards Committee (IASC) in 2001. “The IFRS Foundation is the legal entity under which the IASB operates.” The objectives of the IFRS are to develop and

The IASC Board approved the IASB (International Accounting Standards Board) Framework ( in April 1989) which was a successor of the IASC Board, and it accepted its Framework in April 2001 (Wells, 2011). International standards are developed by IASB which are named International Financial Reporting Standards (IFRS). Although IASB took the place of IASC with its accounting standards, its IAS (International Accounting Standards) was enforced by IASB and available into practice until now. The conceptual framework is helpful when it is used to develop the setting of International accounting standards. First of all, the definition of conceptual framework provided by Melville (2014, p. 17)[ Melville, A. (2014). International Financial Reporting.(4th ed.). Edinburgh Gate:

The conceptual framework was issued by the International Accounting Standards Board (IASB) in 2010, and is define as a group of ideas or principles used to plan or decide something. It can be seen as a set of guiding principles – that is, those ideas or concepts that influence and

The IASB laid out in its discussion paper proposed changes and updates to: definitions of assets and liabilities, recognition and de-recognition of assets and liabilities, measurement, equity, profit or loss and other comprehensive income (OCI), and presentation and disclosure. The IASB believes that the International Financial Reporting Standards (IFRS) does not define some matters adequately enough. In the discussion paper, some areas are being completely rewritten while others just need some clarification and guidance.

In the following question conceptual framework will be examined, firstly the critical definition and format of conceptual framework will be reviewed. Which is then follow by its general benefit and limitation of this method. Secondly the limitation and benefit of a single framework in developing accounting standard is discussed