BMW Group: A Critical Analysis of Conceptual Framework Obligations

CONTEMPORARY ISSUES IN ACCOUNTING

BMW Group
Executive Summary
It is the conceptual that binds the organization and provides meaningful information to the
end users. The financial reporting users are able to get a clear view of the organization. In this
report, BMW is selected for the purpose of study and a critical analysis has been done to
ensure that the corporation has met the conceptual framework obligations. The report
initiates with a strong emphasis on BMW followed by the consideration of conceptual
framework objective. Further, the recognition criteria are discussed together with the
fundamental enhancing guidelines. From the overall report, it can be commented that the
company has adhered to the CF of financial reporting. Overall, it can be said that the
company has effectively portrayed the recognition criteria and can be known through the
intangibles, financial instruments, etc.
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BMW Group
Contents
Introduction...........................................................................................................................................3
Consideration of conceptual framework objective................................................................................4
Recognition criteria...............................................................................................................................5
 Risks, rewards, and opportunities.................................................................................................5
 Revenue recognition......................................................................................................................5
 Public sector grants.......................................................................................................................6
 Intangibles.....................................................................................................................................6
 Impairment of intangible assets....................................................................................................6
 Leased items..................................................................................................................................6
 Financial instruments....................................................................................................................6
 Deferred taxes...............................................................................................................................7
Fundamental and enhancing guidelines................................................................................................7
Recommendation..................................................................................................................................9
Conclusion...........................................................................................................................................10
References...........................................................................................................................................11
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BMW Group
Introduction
The conceptual framework of accounting is crucial for every company in the modern scenario
to comply with because it facilitates in enhancing the meaningfulness of financial information
present in the statements. Besides, the users of financial reporting can easily interpret the
financial information for the purpose of making effective decisions (Petersen & Plenborg,
2012). Meanwhile, in the absence of such conceptual framework, understandability,
relevance, reliability, and many more qualitative characteristics of financial reporting cannot
be obtained, thereby degrading the process of corporate reporting as a whole. Moreover,
based on the complications in the current working environment, the prevalence of conceptual
framework is vital for all stakeholders in their decision-making process (Peirson et. al, 2015).
With the help of this report, an evaluation of BMW Group’s attempt will be made in order to
ensure whether the organization has met the obligations of the conceptual framework for
reporting.
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