Table of ContentsINTRODUCTION...........................................................................................................................3MAIN BODY...................................................................................................................................31. IASB's conceptual framework and accounting concepts........................................................32. Importance of different accounting concepts in making financial statements.......................5CONCLUSION................................................................................................................................6REFERENCES ...............................................................................................................................7
INTRODUCTIONFinancial reporting means disclosure of financial results which include informationrelated to internal as well as external users about company's performance. Financial reports areissued mostly on annual basis. It includes balance sheet, income statement and also profit andloss statement. The process of making financial reporting according to prescribed standards ofIASB is known as financial statements. The report shows the importance of financial reporting indecision making process of the company. The report focuses on framework of internationalaccounting standard board along with accounting concepts. It includes basic concepts offinancial reporting which includes recognition, financial presentation and measurement. Itdescribes various concepts like accrual, periodicity etc. which are important while preparingfinancial statements.MAIN BODY1. IASB's conceptual framework and accounting conceptsThe international Accounting standards board of UK has its own framework for financialreporting. It helps to ensure that accounting standards are consistent and all transactions treatedin the same way. This conceptual framework help companies in developing and implementingpolicies on accounting and helps stakeholders in understanding the standards. It consists of rulesand regulations that are important when making financial statements of the company. Itaddresses the objectives of financial reporting. It focuses on both qualitative and quantitativeinformation. It measures the financial statements and shows real value of the firm and disclosesconcept of capital and its maintenance (IASB framework, 2018).Objectives of financial reporting According to IASB, the objectives of financial reporting is to provide information aboutfinancial position and performances of the finances (monetary) that changes financial position ofthe company which helps in making decisions of the company (Objectives of financial reporting2018).It provides information to creditors, promoters, investors and help them in makingrational decisions based on investment, cash flow etc.It help in providing information to management of company and assist in planing,analysing and making decisions.
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