Question

state the objective of IFRS conceptual framework and the outline the enhancing qualitative characteristics included in the IFRs conceptual framework

Answer 1

Ans.

INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS), HAS BEEN DEVELOPED INTERNATIONAL ACCOUNTING STANDARDS BOARDS (IASB),  IT'S A SET OF ACCOUNTING STANDARDS , IN FEW YEARS AGO IN WHOLE OF WORLD NOT HAVE ANY FRAMEWORK FOR PREPARING HIS FINANCIAL STATEMENTS,

IF THERE WERE NO FRAMEWORK FOR PREPARING FINANCIAL STATEMENT , ACCOUNTING STANDARDS WOULD BE DEVELOPED IN A RANDOM, HAPHAZARD WAY TO DEAL WITH ISSUES AS THEY ARISE. THIS WOULD RESULTS IN STANDARDS WHICH WOULD BE INCONSISTENT WITH EACH OTHER OR LEGISLATION.

MANY PARTS OF FINANCIAL STATEMENTS ARE BASED ON JUDGEMENT, MODELS AND ESTIMATES RATHER THAN EXACT POSITIONS, THIS IASB CONCEPTUAL FRAMEWORK PROVIDES THE CONCEPTS UNDERLYING THOSE JUDGEMENTS, ESTIMATES AND MODELS.

THIS CONCEPTUAL FRAMEWORK SET OUT THE CONCEPTS AND IDEAS THAT UNDERLINE THE PREPARATION AND PRESENTATION OF FINANCIAL STATEMENTS FOR EXTERNAL USERS.

THE PURPOSE OF CONCEPTUAL FRAMEWORK IS

1. THE OBJECTIVE OF FINANCIAL REPORTING

2. THE QUALITATIVE CHARACTERISTICS OF USEFUL FINANCIAL INFORMATION OF THE REPORTING ENTITY

3. TO ASSIST THE IASB IN THE DEVELOPMENT OF FUTURE ACCOUNTING STANDARDS AND IN ITS REVIEW OF EXISTING ACCOUNTING STANDARDS, ENSURING CONSISTENCY ACROSS STANDARDS.

4. TO ASSIST THE IASB IN PROMOTING HARMONISATION OF REGULATIONS, ACCOUNTING STANDARD  AND PROCEDURES RELATING TO THE PRESENTATION OF FINANCIAL STATEMENTS BY PROVIDING A BASIS FOR REDUCING THE NUMBER OF ALTERNATIVE ACCOUNTING TREATMENTS PERMITTED  BY ACCOUNTING STANDARDS,

5. TO ASSIST PRE- PARERS OF FINANCIAL STATEMENTS IN APPLYING INTERNATIONAL FINANCIAL REPORTING STANDARDS AND IN DEALING WITH TOPICS THAT HAVE YET TO FORM THE SUBJECT OF AN ACCOUNTING

6. TO ASSIST USERS OF FINANCIAL STATEMENTS IN INTERPRETING THE INFORMATION CONTAINED IN FINANCIAL STATEMENTS PREPARED IN COMPLIANCE WITH INTERNATIONAL FINANCIAL REPORTING STANDARDS.

7. TO ASSIST AUDITORS IN FORMING AN OPINION ON WHETHER FINANCIAL STATEMENTS COMPLY WITH INTERNATIONAL ACCOUNTING STANDARDS, AND

8. TO PROVIDES THOSE WHO ARE INTERESTED IN THE WORK OF THE IASB WITH INFORMATION ABOUT ITS APPROACH TO THE FORMULATION OF ACCOUNTING STANDARDS.