CFAS Chapter 2: Purpose and Scope of Financial Reporting
Conceptual Framework for Financial Accounting - correct answer ✔✔It is a complete, comprehensive,
and single document promulgated by the international Accounting Standards Board.
Conceptual Framework - correct answer ✔✔It is the summary of the terms and concepts that underlie
the preparation and presentation of financial statements for external users.
General Purpose Financial Reporting - correct answer ✔✔Conceptual framework describes the concepts
for ?
Conceptual Framework - correct answer ✔✔It is an attempt to provide an overall theoretical foundation
for accounting.
Conceptual Framework - correct answer ✔✔It is intended to guide standard setters, preparers and users
of financial information in the preparation and presentation of statements.
Contribute to transparency - correct answer ✔✔Enhancing international comparability and quality of
financial information.
Strengthen accountability - correct answer ✔✔Reducing information gap between the providers of
capital and the people to whom they have entrusted their money.
Contribute to economic efficiency - correct answer ✔✔Helping investors to identify opportunities and
risks across the world.
a. Assist the International Accounting Standards Board (IASB) in developing IFRS Standards based on
consistent concepts.
b. Assist preparers of FS to develop consistent accounting policy when no standard applies to a particular
transaction or other event or where an issue is not yet addressed by an IFRS.
, c. Assist preparers of FS to develop accounting policy when a standard allows a choice of an accounting
policy.
d. Assist all parties to understand and interpret the IFRS standards. - correct answer ✔✔Purposes of
Revised Conceptual Framework
False. - correct answer ✔✔If there is a standard or an interpretation that specifically applies to a
transaction, the standard or interpretation does not overrides the Conceptual Framework. True or False
Primary and Other Users - correct answer ✔✔The two users of financial information under the
Conceptual Framework for Financial Reporting are?
Primary Users - correct answer ✔✔This include the existing and potential investors, lenders, and other
creditors
Other Users - correct answer ✔✔Include the employees, customers, governments and their agencies,
and the public.
Primary Users - correct answer ✔✔Parties to whom general purpose financial reports are primarily
directed.
Existing and Potential Investors - correct answer ✔✔Concerned with the risk inherent in and return
provided by their investments.
Existing and Potential Lenders and other creditors - correct answer ✔✔Interested in the information
which enables them to determine whether their loans, interest thereon and other amounts owing to
them will be paid when due.
Other Users - correct answer ✔✔Users of financial information other than the existing and potential
investors, lenders, and other creditors.
Other Users - correct answer ✔✔They are the parties that may find the general purpose financial reports
useful but the reports are not directed to them primarily.
Conceptual Framework for Financial Accounting - correct answer ✔✔It is a complete, comprehensive,
and single document promulgated by the international Accounting Standards Board.
Conceptual Framework - correct answer ✔✔It is the summary of the terms and concepts that underlie
the preparation and presentation of financial statements for external users.
General Purpose Financial Reporting - correct answer ✔✔Conceptual framework describes the concepts
for ?
Conceptual Framework - correct answer ✔✔It is an attempt to provide an overall theoretical foundation
for accounting.
Conceptual Framework - correct answer ✔✔It is intended to guide standard setters, preparers and users
of financial information in the preparation and presentation of statements.
Contribute to transparency - correct answer ✔✔Enhancing international comparability and quality of
financial information.
Strengthen accountability - correct answer ✔✔Reducing information gap between the providers of
capital and the people to whom they have entrusted their money.
Contribute to economic efficiency - correct answer ✔✔Helping investors to identify opportunities and
risks across the world.
a. Assist the International Accounting Standards Board (IASB) in developing IFRS Standards based on
consistent concepts.
b. Assist preparers of FS to develop consistent accounting policy when no standard applies to a particular
transaction or other event or where an issue is not yet addressed by an IFRS.
, c. Assist preparers of FS to develop accounting policy when a standard allows a choice of an accounting
policy.
d. Assist all parties to understand and interpret the IFRS standards. - correct answer ✔✔Purposes of
Revised Conceptual Framework
False. - correct answer ✔✔If there is a standard or an interpretation that specifically applies to a
transaction, the standard or interpretation does not overrides the Conceptual Framework. True or False
Primary and Other Users - correct answer ✔✔The two users of financial information under the
Conceptual Framework for Financial Reporting are?
Primary Users - correct answer ✔✔This include the existing and potential investors, lenders, and other
creditors
Other Users - correct answer ✔✔Include the employees, customers, governments and their agencies,
and the public.
Primary Users - correct answer ✔✔Parties to whom general purpose financial reports are primarily
directed.
Existing and Potential Investors - correct answer ✔✔Concerned with the risk inherent in and return
provided by their investments.
Existing and Potential Lenders and other creditors - correct answer ✔✔Interested in the information
which enables them to determine whether their loans, interest thereon and other amounts owing to
them will be paid when due.
Other Users - correct answer ✔✔Users of financial information other than the existing and potential
investors, lenders, and other creditors.
Other Users - correct answer ✔✔They are the parties that may find the general purpose financial reports
useful but the reports are not directed to them primarily.
