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Conceptual and Regulatory Framework of Financial Reporting: PDF

   

Added on  2021-01-02

15 Pages2947 Words65 Views
FINANCIAL REPORTING
Conceptual and Regulatory Framework of Financial Reporting: PDF_1
Table of ContentsINTRODUCTION...........................................................................................................................11 Context and purpose of financial reporting..............................................................................12 Conceptual and Regulatory framework of financial reporting.................................................23 Benefits of financial reporting to stakeholders.........................................................................34 Value of financial reporting for meeting organisation objectives and growth.........................45. Financial statements.................................................................................................................56. Interpretation of ratios.............................................................................................................77 Difference between IAS and IFRS...........................................................................................98 Evaluation of benefits of IFRS.................................................................................................99. Ascertaining the varying degree of compliance...................................................................10CONCLUSION..............................................................................................................................10REFERENCES..............................................................................................................................12
Conceptual and Regulatory Framework of Financial Reporting: PDF_2
Conceptual and Regulatory Framework of Financial Reporting: PDF_3
INTRODUCTIONFinance helps in smooth functioning of various business activities. Structure of everybusiness differs because of availability of finance with them. As finance is considered as sole ofevery business then its management must be done in most efficient manner so that returns arehigher (Al-Matari, 2013). Financial reporting is a document which provides true and fairinformation about financial position of different companies by one of biggest accounting firmDeloitte. In this project report about purpose of financial reporting, conceptual and regulatoryframework of financial reporting, main stakeholders of organisations, value of financialreporting, interpretation of financial statements, standards and theoretical model andinternational differences in financial reporting will be mentioned.1 Context and purpose of financial reportingFinancial reporting is a process of producing financial statements that presents financialstatus of an organisation to its users such as shareholder's, investors, employees. Financialreporting gives an overview regarding integrity and creditworthiness of a company. Decisions byinternal management of any business is very much connected with financial reportinginformation. Reporting incudes detailed information regarding inflows and outflows of acompany by preparation of various financial statements such as profit and loss account, balancesheet, income statement, cash flow statement etc. Financial reporting plays very important role in corporate world. Its main purpose is toprovide full financial information to owners of a business when ownership and management of acompany is in two different hands. Large public company arranges their funds for business fromgeneral public and in return of this investment a small portion of ownership is given to them interms of share. Different minds have different opinions in every situation and owners want theirinvestment to grow and earn more returns (Chae and Oh, 2016). To know about investments ofcompany and returns financial statements are required. Other purpose for which financialstatements are prepared is to calculate financial growth as required by investors to makeinvestment decisions. Financial reporting also reflects about frauds or miss-utilisation of funds in a company,that helps to locate real reason for this miss-utilisation. Reasonable actions will be taken toresolve this issue when problem is located in time. Financial reporting of one organisation is1
Conceptual and Regulatory Framework of Financial Reporting: PDF_4

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