Financial statement, Asset, Audit

The Framework described as a concept that underlie in the financial statement which is focus on interpretation, address, classify, preparation, and presentation each of company transactions that can change the company value and financial report. The frameworks deal with the objective of financial statements, qualitative characteristics the information to be usefulness, definition and recognition of financials statements’ elements. Therefore, framework develops the accounting standards to correct the accounting errors and estimates and adjudicate a particular item in an appropriated way. But the framework is not an accounting standard, thus framework doesn’t override any accounting standards. Incidentally, framework does the consistency of accounting regulations and accounting standards which is related to the financial reports. Therefore, framework indirectly assists the user of financial reports to understand and interpreting information that present in the financial reports. (Clift & Navaratnam 1991, p653).

(i) Discuss the benefit of having a conceptual framework of accounting. The accounting conceptual framework will bring a lot of benefit for the auditor, accountant, and user when preparing and using the financial reports. To having a conceptual framework will bring the advantages like easily to interpretation and classify the company’s information to procedures relating of presentation of financial reports users in order to make the related resources allocation or economic decisions. (Clift & Navaratnam 1991, p653). An accounting conceptual framework had becomes a guideline to development, objective, and specification the accounting standards and financial reports. The framework develops a set of accounting standards to ensure internally consistency, which is becomes a filter to identification and recognition all the financial elements it is before recognize in the financial reports. Framework was also corrects and revises the...
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