CFAS Reviewer for Chapter 2 questions with correct answers

What is the Conceptual Framework for Financial Reporting? - correct answer It is a framework that describes the objective of, and the concepts for, general purpose financial reporting Who revises the Conceptual Framework for Financial Reporting? - correct answer IASB What are the 3 purposes of the Conceptual Framework? - correct answer (a) Assist the IASB to develop IFRS that are based on consistent concepts (b) Assist preparers to develop consistent accounting policies when no Standard applies to a particular transaction or other event, or when a Standard allows a choice of accounting policy (c) Assist all parties to understand and interpret the Standards Is the Conceptual Framework a IFRS or a PFRS? - correct answer Neither What happens when the Conceptual Framework conflicts with an accounting standard? - correct answer The accounting standard will prevail List down the content of the Conceptual Framework - correct answer 1. Objective of General Purpose Financial Statements 2. Qualitative Characteristics of Useful Financial Information 3. Financial Statements and the Reporting Entity 4. Elements of the Financial Statements 5. Recognition and Derecognition 6. Measurement