users a single framework of financial reporting is essential. Payne and Raagan (2008:15) also consider that 'A universal financial reporting standard would help participants in the world's capital markets and other users make economic decisions'. CONCEPTUAL FRAMEWORK AND ACCOUNTING STANDARDS Barth (2006) explains that the definitions of financial statement elements along with the objective and the qualitative characteristics of financial reporting are set by the conceptual framework. It is aimed
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Using a conceptual framework in setting accounting standards Ian Dennis Business School Oxford Brookes University Abstract The paper examines the nature and role of a conceptual framework for financial reporting. Although much has been written about such frameworks and their purported role and the FASB and IASB are currently revising and converging their frameworks there are still questions about the kind of thing it is and how it is used in setting accounting standards. Using insights
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Derek Seedorf Acct 450 Conceptual Framework Project Analysis Spring 2015 Directions Investigate the “Conceptual Framework Project” of the FASB and IASB. Answer the following: 1. When did the project begin? The in class text seems to suggest that the project initially started in October 2004 when the FASB and IASB decided to add to their agendas the joint project of developing an improved conceptual framework for both the IASB’s Preparation and Presentation
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A conceptual framework for financial reporting A conceptual framework, in the field we are concerned with, is a statement of generally accepted theoretical principles which form the frame of reference for financial reporting. The financial reporting process is concerned with providing information that is useful in the business and economic decision-making process. Therefore a conceptual framework will form the theoretical basis for determining which events should be accounted for, how they should
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Insurance Contracts This project deals with the accounting for insurance contracts. As stated on the site, “accounting for insurance contracts does not provide users with the information they need to meaningfully understand the insurer’s financial position, performance and risk exposure.” Additionally, IFRS does not provide the proper guidance to how insurers should handle certain issues. The main goal of the Insurance Contracts project is to provide a single principle-based standard to account
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FRAMEWORK FRAMEWORK Conceptual framework: coherent set of hypothetical, conceptual and pragmatic principles forming the general framework of reference for field of inquiry. (Hendriksen, 1970). Conceptual framework: * Consider as normative theories because it provide prescription. * Can be descriptive, prescriptive or mixture of both: * Descriptive: Attempt to develop a set of interrelated concept which server as codify and explain financial reporting practices * Rationale
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COMMENTARY A Framework for Financial Reporting Standards: Issues and a Suggested Model American Accounting Association’s Financial Accounting Standards Committee (AAA FASC) James A. Ohlson, Stephen Penman, Robert Bloomfield, Theodore E. Christensen, Robert Colson, Karim Jamal, Stephen Moehrle, Gary Previts, Thomas Stober, Shyam Sunder, and Ross L. Watts SYNOPSIS: This paper addresses the issues that confront the FASB and IASB in developing a new conceptual framework document. First, we
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Objectives of GPFR The conceptual framework (CF) is a logical guideline of interrelated objectives and fundamentals that are expected to lead to consistent accounting standards and underlie the preparation and presentation of financial reports. Only CF and SAC 2 deal with the objective of GPFR (Mala 2013, pp. 12-6). There is no clear definition of the objectives of GPRF in the Conceptual Framework but according to the CF’s guideline and SAC 2 there are few objectives that GPRF should be met: OB1
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In a broad sense a conceptual framework can be seen as an attempt to define the nature and purpose of accounting. A conceptual framework must consider the theoretical and conceptual issues surrounding financial reporting and form a coherent and consistent foundation that will underpin the development of accounting standards. Conceptual frameworks can apply to many disciplines, but when specifically related to financial reporting, a conceptual framework can be seen as a statement of generally
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(gains and losses) of net assets as part of income (clean surplus) (Hodgson, 2014). The all-inclusive income method was adopted by the Financial Accounting Standards Board (FASB) in 1997 and subsequently the International Accounting Standards Board (IASB), leading to ‘comprehensive income’ reporting. Comprehensive Income (CI) is the sum of Profit or Loss (P&L) and OCI. OCI comprises of items of income and expense not recognised in profit or loss as required or permitted by AASB (AASB, 2014) Recent
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