Module: Accounting & Finance Theories and Issues
Seminar 3
Question 1
Describe and explain in your own words what is meant by a conceptual framework of
accounting.
IASB Conceptual Framework
What do you think Framework means?
A skeleton/structure. A foundation upon which something is built.
Principals that help accountants do their job.
True & fair view that the information can be relied on
The framework is not a standard on its own it helps when it wants to
amend existing standards. It assists in developing new standards.
The definition of an asset will be in the framework
When you look at the definition of an asset, it does not mean that it has to be
owned by you. If you have control over it, then it counts as an asset. You don’t
necessarily have to own the asset.
If you have a strong foundation, then any standard that is built upon the
framework will be strong enough and therefore will last and stand the test of
time.
Question 2
Do you think that we need conceptual frameworks of accounting? Explain your
answer and provide examples.
Rules of accounting
If needed in the development of accounting standards, then this framework is
needed.
We need the conceptual framework to see whether the accounting information
provided is useful.
Qualitative characteristics of financial information
Seminar 3
Question 1
Describe and explain in your own words what is meant by a conceptual framework of
accounting.
IASB Conceptual Framework
What do you think Framework means?
A skeleton/structure. A foundation upon which something is built.
Principals that help accountants do their job.
True & fair view that the information can be relied on
The framework is not a standard on its own it helps when it wants to
amend existing standards. It assists in developing new standards.
The definition of an asset will be in the framework
When you look at the definition of an asset, it does not mean that it has to be
owned by you. If you have control over it, then it counts as an asset. You don’t
necessarily have to own the asset.
If you have a strong foundation, then any standard that is built upon the
framework will be strong enough and therefore will last and stand the test of
time.
Question 2
Do you think that we need conceptual frameworks of accounting? Explain your
answer and provide examples.
Rules of accounting
If needed in the development of accounting standards, then this framework is
needed.
We need the conceptual framework to see whether the accounting information
provided is useful.
Qualitative characteristics of financial information
