Development in Accounting - Report
Added on 2020-01-28
9 Pages2584 Words38 Views
Current Development inAccounting thought
Table of ContentsQuestion 1........................................................................................................................................3Question 2........................................................................................................................................4Question 3........................................................................................................................................5REFERENCES................................................................................................................................8
Question 1The main purpose of general financial reporting is that to deliver the financial data to thebusiness entity which are mainly useful for the investors, creditor and lenders to make theeffective decisions regard to delivering the resources of business entities. In the conceptualframework in the information are essential to the investors who meet their needs regard toinformation of the another stakeholders at the maximum extent. Thus, in these accountingconceptual framework the main fundamental of qualitative characteristics in which there is afinancial data that are able to made a variation to the user decisions. Therefore, in order to makethe difference in the financial data which has both predictive value as well as confirmatory value.There are various qualitative criteria that are useful to possess the financial information in thedecision making process are the reliability and relevance ( Altamuro and Beatty,2010).Therefore, it is more critical there is no matter how these information are reliable and relevantthat help the financial information in decision making. It is necessary that the accountinginformation is more reliable and relevant that assist them to make effective decision. Thus, inrelevance, for the purpose of making difference in these process the financial data must have afeedback value or predictive value. Usually, the essential information must possess bothqualitative criteria reliable and relevant qualities. Furthermore, in the reliability in which theinformation must be verifiable, neutral and verifiable. It can explained further in which thehistorical cost of land are to be reported into the balance sheet of a firm that are generally said ahighly verifiable. Thus, the cost can be track to the exchange transaction in which the buyer ofthe land and the market value of that particular land becomes difficult in verifying. Therefore,the term of objectivity are to be linked with the verifiability. It can be said that the objectivity isthat the historical cost of the land and on the other side land's market value is a subjectivity. Itmajorly influencing through the past experience measure as well as prejudices. Thus, themeasurement of these subjectivity is more difficult to make verification that make the user moredifficult. Representation faithfulness are to be present when there is an agreement among thedescription and the with the phenomenon. It can be explained further, it make assumption inwhich the stock are to be into the balance sheet of the retail organisation that are understoodthrough the external users that are mainly representing the particular items that are mainlyintended for selling the ordinary business. Thus, if the stock that majorly involves a machinesthat are used for the purpose of producing the inventory than it comes in lacks of representational
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