Accounting Theory & Contemporary Issues

Running Head: ACCOUNTING THEORY & CONTEMPORARY ISSUES
ACCOUNTING THEORY & CONTEMPORARY ISSUES
Name of the Student
Name of the University
Author Note

1ACCOUNTING THEORY & CONTEMPORARY ISSUES
Table of Contents
Introduction................................................................................................................................2
Discussion..................................................................................................................................2
Answer 1................................................................................................................................2
Answer 2................................................................................................................................3
Answer 3................................................................................................................................3
Answer 4................................................................................................................................4
Conclusion..................................................................................................................................4
Reference....................................................................................................................................6

2ACCOUNTING THEORY & CONTEMPORARY ISSUES
Introduction
Conceptual framework is the term that is use to represent system of ideas as well as
objectives that assist in creating the set of consistent rules as well as regulations. These
standards and rules set the nature, functions as well as limits of the financial statements as
well as financial accounting (Richardson et al. 2015). Therefore, this assignment will discuss
the conceptual framework role in the accounting, general-purpose financial reporting
objectives, prudence concept and substance over form concept as well as faithful
representation.
Discussion
Answer 1
Conceptual Framework role in Accounting
The conceptual framework is that concept, which has major role in accounting. It has
key role in providing with the assistance to the IASB in the future development of the IFRS
as well as providing review to the current IFRS. It provide assistance to the financial
statement preparers in development of the policies of the accounting for events and
transactions that are basically not covered in current standards. Moreover, conceptual
framework has the major benefit for setting of the accounting standards, fundamental
principles and provides the basis for resolving accounting disputes that have not to be
repeated in the accounting standards (Ifrs.org. 2019).
In the year 2010, the published conceptual framework has been criticized heavily in
relation to lack of the clarity, exclusion of certain important terms as well as being outdated
in the current IASB thought. This has resulted into IASB into proposing for the shifting of the
fundamental concepts of the liabilities and the assets to improve clarity (Ifrs.org. 2019).