Financial Reporting: Assignment Solution
Added on 2020-12-30
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Financial Reporting
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................11. Conceptual framework for Financial Reporting ....................................................................12. Basic accounting concepts and assumptions..........................................................................3CONCLUSION ...............................................................................................................................4REFERENCES ...............................................................................................................................5
INTRODUCTIONFinancial Reporting is a term which refers to the process of preparing accounts, statements orreports with the help of recorded data, information available in relation to the financial andmonetary activities of the business organisation. With the help of financial reporting themanagers can make important and crucial decision of the business. The report will discuss aboutobjective behind preparation of financial report. It will also discuss the basic difference betweenWhy and How accounting is done. Further on, the report will provide information about qualitywhich a report should possess i.e. Relevance, comparable, Free from error etc. At last, the reportwill discuss about accounting concepts and assumptions which every company uses for makingaccounting transactions and also for preparing financial statement. MAIN BODY1. Conceptual framework for Financial Reporting Overview: It is the comprehensive process to set the system of financial reporting of thebusiness in an accounting year (Conceptual Framework for Financial Reporting, 2018). Itincludes various aspects such as objective, description of report and detailed study of thecharacteristic and numbers in the report. Basic objective: Its objective is to provide useful information to the users so that they can decidethe company future and resources to deal in the near future (Acharya and Ryan, 2016). Its helpsthe management team to decide the economic resources available with the company and theinflow and outflow of cash transaction and also expenses that incurred in the company books. Fundamental concepts:The objective of accounting is to maintain the full record of the business internal andexternal matters and the amount which they incurred in any projects and the process and attainsthe profits and loss incurred in the business transactions (Flower, 2018). The fundamentalconcepts of accounting are ~- Recognition: It recognises the company assets and liabilities and other expense and provide arelevant information relation to the matters to the user, creditors and investor so that they knowthe facts in the business. 1
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