FAC3701
ASSIGNMENT 2 SEMESTER 1 2025
UNIQUE NO.
DUE DATE: APRIL 2025
, FAC3701
Assignment 2 Semester 1 2025
Unique Number:
Due Date: April 2025
General Financial Reporting
MEMO
To: Mr Tsego, CEO of Valley Ltd
From:
Date: 7 August 2024
Subject: Faithful Representation of Financial Information
Dear Mr Tsego,
In preparing Valley Ltd’s financial statements for the year ended 30 June 2024, it is
essential that the financial information presented to the directors provides faithful
representation of the company’s financial position and performance. According to the
Conceptual Framework for Financial Reporting, faithful representation requires that
financial information possesses the following three characteristics:
1. Completeness – Financial statements must include all necessary information for
users to understand the economic events that have affected Valley Ltd. This
means ensuring that all relevant transactions, including changes in inventory
valuation and vehicle depreciation adjustments, are fully reported.
2. Neutrality – Financial information must be free from bias. It should not be
presented in a way that influences users to make particular decisions. For
example, losses due to stolen inventory or changes in market prices must be
reported accurately, even if they have a negative impact on profits.
ASSIGNMENT 2 SEMESTER 1 2025
UNIQUE NO.
DUE DATE: APRIL 2025
, FAC3701
Assignment 2 Semester 1 2025
Unique Number:
Due Date: April 2025
General Financial Reporting
MEMO
To: Mr Tsego, CEO of Valley Ltd
From:
Date: 7 August 2024
Subject: Faithful Representation of Financial Information
Dear Mr Tsego,
In preparing Valley Ltd’s financial statements for the year ended 30 June 2024, it is
essential that the financial information presented to the directors provides faithful
representation of the company’s financial position and performance. According to the
Conceptual Framework for Financial Reporting, faithful representation requires that
financial information possesses the following three characteristics:
1. Completeness – Financial statements must include all necessary information for
users to understand the economic events that have affected Valley Ltd. This
means ensuring that all relevant transactions, including changes in inventory
valuation and vehicle depreciation adjustments, are fully reported.
2. Neutrality – Financial information must be free from bias. It should not be
presented in a way that influences users to make particular decisions. For
example, losses due to stolen inventory or changes in market prices must be
reported accurately, even if they have a negative impact on profits.
