THE CONCEPTUAL FRAMEWORK FOR FINANCIAL REPORTING
Dissertation
BY PEARL IRENE TALJARD
(ICB Member ID: 907731)
submitted in partial fulfilment of the requirements for the National Diploma:
FINANCIAL ACCOUNTING
(SAQA ID: 20366)
December 2024
DECLARATION BY STUDENT:
I declare that this dissertation submitted by me, is entirely my own work, that I have not used
any Artificial Intelligence tools, I have properly referenced all the sources used and that no
part was previously submitted at any other institution.
Signature: Date: 30 December 2024
,DEDICATION
This mini-dissertation is dedicated to my family and friends. Without your love, support, and
encouragement, I wouldn’t have come this far. You have always believed in me, even when I
doubted myself, and your constant faith in me has kept me going. I’m incredibly grateful for
everything you’ve done.
I’d also like to thank my co-workers, who have been understanding and supportive
throughout this journey. Your advice and encouragement have helped me navigate the
challenges along the way, and I truly appreciate it.
II
,ABSTRACT
Emphasizing the need of knowing the conceptual underpinnings in accounting, this
dissertation looks at the adoption of a principles-based approach by the Conceptual
Framework for Financial Reporting. This paper investigates the Conceptual Framework
under a theoretical framework derived from the Social Reality Construction Model (SCRM).
This model helps us to understand how our view of social reality affects the financial
reporting process and how the framework shapes accounting procedures. If we neglect these
basic ideas, the theoretical elements of accounting might just scratch the surface and fail to
capture the nuances of financial reporting in the modern firm setting.
III
,Table of Contents
DEDICATION.....................................................................................................................................................ii
ABSTRACT........................................................................................................................................................iii
Chapter 1: Introduction to the Conceptual Framework for Financial Reporting ..........................................1
1.1 Background of the Research.........................................................................................................................1
1.2 Expression of the Issue ..................................................................................................................................4
1.3 Principal inquiry question .............................................................................................................................4
1.4 Research Study's Goal ...................................................................................................................................5
1.5 Research Topics .............................................................................................................................................6
1.6 Study justification ..........................................................................................................................................6
1.7 Research Limitation.......................................................................................................................................7
1.8 Restraints.........................................................................................................................................................7
1.9 Definitions of terms: ......................................................................................................................................8
1.10 Adoption of principles-based conceptualization in the Financial Reporting Conceptual Framework
................................................................................................................................................................................9
1.11 The Value of Recognizing Conceptualization in Accounting ..............................................................11
1.12 Chapter synopsis ........................................................................................................................................13
Chapter 2: Literature Review, Analysing the Impact of Conceptual Framework For Financial Reporting
..............................................................................................................................................................................15
2.1 Review of the Literature..............................................................................................................................15
2.1.1. Purpose and Objectives...........................................................................................................................15
2.1.2 Qualitative Features ..................................................................................................................................16
2.1.3. Implementation Difficulties....................................................................................................................16
2.1.4. Principles–Based Approach ...................................................................................................................17
2.1.5. Compliance with Global Guidelines .....................................................................................................17
2.1.6. Ethical Considerations.............................................................................................................................17
2.1.7 Future Developments ...............................................................................................................................18
2.2 Regarding The Conceptual Framework for Financial Reporting, what are the present good
worldwide criticisms? ........................................................................................................................................18
2.2.1 Good International Review......................................................................................................................18
2.3 Regarding The Conceptual Framework for Financial Reporting, what are the present negative
international criticisms? .....................................................................................................................................19
IV
,2.3.1. Negative Criticism from Other Countries .............................................................................................19
2.4 Chapter Summary........................................................................................................................................19
Chapter 3: Research ...........................................................................................................................................21
3.1 Method of Research.....................................................................................................................................21
3.1.1 Strategies and Research Tools.................................................................................................................21
3.1.2 Secondary Data Sources ..........................................................................................................................23
Table 1 ..................................................................................................................................... 23
3.1.2: Table Explanation .......................................................................................................... 23
3.2. Comparative Examining of the Financial Reporting Conceptual Framework ....................................24
3.2.1 Goals and Objectives in Mind.................................................................................................................25
3.2.2. Qualitative traits .......................................................................................................................................25
3.2.3. Obstacles in Execution ............................................................................................................................25
3.2.4 Applied Principles-Based Approach ......................................................................................................26
3.2.5. Conformity with IFRS ............................................................................................................................27
3.2.6 Moral Issues ..............................................................................................................................................27
3.2.7 Future Developments ...............................................................................................................................27
3.3 Methodology Summary ..............................................................................................................................28
Chapter 4: Methodology: Data Collection and Analysis of Fair Value Disclosure....................................29
4.1 Welcome Introduction.................................................................................................................................29
Table 4.1 Response from questionnaires ................................................................................. 30
Figure 4.1 Response rate in terms of academic ....................................................................... 31
4.2 Response to questions .................................................................................................................................31
4.2.1 Respondents ..............................................................................................................................................32
4.3. Interview Study ...........................................................................................................................................32
Table 4.2: Summary of conducted interviews. ...............................................................................................34
4.3.1 Operationalization of quantitative data...................................................................................................36
4.4 Chapter summary.........................................................................................................................................38
Chapter 5: Empirical Analysis of Investment Property: Theoretical Framework, Results, and Criticism
..............................................................................................................................................................................39
5.0 Introductions.................................................................................................................................................39
5.1.1 Chapter Summaries ..................................................................................................................................39
5.1.2 Inquiry question ........................................................................................................................................40
V
, 5.2 Research results............................................................................................................................................43
5.3 Notes .............................................................................................................................................................44
5.4 Suggestions...................................................................................................................................................44
5.5 Recommended additional research topics.................................................................................................45
5.6 Additional Research Considerations..........................................................................................................46
5.7 Chapter Summary........................................................................................................................................47
References...........................................................................................................................................................48
VI
Dissertation
BY PEARL IRENE TALJARD
(ICB Member ID: 907731)
submitted in partial fulfilment of the requirements for the National Diploma:
FINANCIAL ACCOUNTING
(SAQA ID: 20366)
December 2024
DECLARATION BY STUDENT:
I declare that this dissertation submitted by me, is entirely my own work, that I have not used
any Artificial Intelligence tools, I have properly referenced all the sources used and that no
part was previously submitted at any other institution.
Signature: Date: 30 December 2024
,DEDICATION
This mini-dissertation is dedicated to my family and friends. Without your love, support, and
encouragement, I wouldn’t have come this far. You have always believed in me, even when I
doubted myself, and your constant faith in me has kept me going. I’m incredibly grateful for
everything you’ve done.
I’d also like to thank my co-workers, who have been understanding and supportive
throughout this journey. Your advice and encouragement have helped me navigate the
challenges along the way, and I truly appreciate it.
II
,ABSTRACT
Emphasizing the need of knowing the conceptual underpinnings in accounting, this
dissertation looks at the adoption of a principles-based approach by the Conceptual
Framework for Financial Reporting. This paper investigates the Conceptual Framework
under a theoretical framework derived from the Social Reality Construction Model (SCRM).
This model helps us to understand how our view of social reality affects the financial
reporting process and how the framework shapes accounting procedures. If we neglect these
basic ideas, the theoretical elements of accounting might just scratch the surface and fail to
capture the nuances of financial reporting in the modern firm setting.
III
,Table of Contents
DEDICATION.....................................................................................................................................................ii
ABSTRACT........................................................................................................................................................iii
Chapter 1: Introduction to the Conceptual Framework for Financial Reporting ..........................................1
1.1 Background of the Research.........................................................................................................................1
1.2 Expression of the Issue ..................................................................................................................................4
1.3 Principal inquiry question .............................................................................................................................4
1.4 Research Study's Goal ...................................................................................................................................5
1.5 Research Topics .............................................................................................................................................6
1.6 Study justification ..........................................................................................................................................6
1.7 Research Limitation.......................................................................................................................................7
1.8 Restraints.........................................................................................................................................................7
1.9 Definitions of terms: ......................................................................................................................................8
1.10 Adoption of principles-based conceptualization in the Financial Reporting Conceptual Framework
................................................................................................................................................................................9
1.11 The Value of Recognizing Conceptualization in Accounting ..............................................................11
1.12 Chapter synopsis ........................................................................................................................................13
Chapter 2: Literature Review, Analysing the Impact of Conceptual Framework For Financial Reporting
..............................................................................................................................................................................15
2.1 Review of the Literature..............................................................................................................................15
2.1.1. Purpose and Objectives...........................................................................................................................15
2.1.2 Qualitative Features ..................................................................................................................................16
2.1.3. Implementation Difficulties....................................................................................................................16
2.1.4. Principles–Based Approach ...................................................................................................................17
2.1.5. Compliance with Global Guidelines .....................................................................................................17
2.1.6. Ethical Considerations.............................................................................................................................17
2.1.7 Future Developments ...............................................................................................................................18
2.2 Regarding The Conceptual Framework for Financial Reporting, what are the present good
worldwide criticisms? ........................................................................................................................................18
2.2.1 Good International Review......................................................................................................................18
2.3 Regarding The Conceptual Framework for Financial Reporting, what are the present negative
international criticisms? .....................................................................................................................................19
IV
,2.3.1. Negative Criticism from Other Countries .............................................................................................19
2.4 Chapter Summary........................................................................................................................................19
Chapter 3: Research ...........................................................................................................................................21
3.1 Method of Research.....................................................................................................................................21
3.1.1 Strategies and Research Tools.................................................................................................................21
3.1.2 Secondary Data Sources ..........................................................................................................................23
Table 1 ..................................................................................................................................... 23
3.1.2: Table Explanation .......................................................................................................... 23
3.2. Comparative Examining of the Financial Reporting Conceptual Framework ....................................24
3.2.1 Goals and Objectives in Mind.................................................................................................................25
3.2.2. Qualitative traits .......................................................................................................................................25
3.2.3. Obstacles in Execution ............................................................................................................................25
3.2.4 Applied Principles-Based Approach ......................................................................................................26
3.2.5. Conformity with IFRS ............................................................................................................................27
3.2.6 Moral Issues ..............................................................................................................................................27
3.2.7 Future Developments ...............................................................................................................................27
3.3 Methodology Summary ..............................................................................................................................28
Chapter 4: Methodology: Data Collection and Analysis of Fair Value Disclosure....................................29
4.1 Welcome Introduction.................................................................................................................................29
Table 4.1 Response from questionnaires ................................................................................. 30
Figure 4.1 Response rate in terms of academic ....................................................................... 31
4.2 Response to questions .................................................................................................................................31
4.2.1 Respondents ..............................................................................................................................................32
4.3. Interview Study ...........................................................................................................................................32
Table 4.2: Summary of conducted interviews. ...............................................................................................34
4.3.1 Operationalization of quantitative data...................................................................................................36
4.4 Chapter summary.........................................................................................................................................38
Chapter 5: Empirical Analysis of Investment Property: Theoretical Framework, Results, and Criticism
..............................................................................................................................................................................39
5.0 Introductions.................................................................................................................................................39
5.1.1 Chapter Summaries ..................................................................................................................................39
5.1.2 Inquiry question ........................................................................................................................................40
V
, 5.2 Research results............................................................................................................................................43
5.3 Notes .............................................................................................................................................................44
5.4 Suggestions...................................................................................................................................................44
5.5 Recommended additional research topics.................................................................................................45
5.6 Additional Research Considerations..........................................................................................................46
5.7 Chapter Summary........................................................................................................................................47
References...........................................................................................................................................................48
VI
