ACCO 310 Lecture 2: Chapter 2- Conceptual Framework Underlying Financial Reporting

• School: Concordia University
• Department: Accountancy
• Course: ACCO 310
• Professor: Elizabeth Peltier- Wagner

Document Summary

Accounting, 10th canadian edition, volume 1 by donald e. kieso, jerry j. weygandt, Terry d. warfield, nicola m. young, irene m. wiecek, bruce j. mcconomy, february. *the following notes are for acco 310: financial reporting. The textbook used for this class is intermediate. Conceptual framework: standard setters use them, they are able to issue additional useful & consistent standards over time. Is the foundation/theory for building accounting concepts & objectives. Chapter 2: conceptual framework underlying financial reporting: the objective of financial reporting: why? (the goal and purpose) Is a residual interest in an entity that remains after liabilities are deducted from assets: also known as net worth. In a business enterprise, equity is the ownership interest: e. g. ordinary shares, preferred shares, retained earnings & accumulated other comprehensive income. The financial statements include the following items (recap from chapter 1) Comprehensive income: includes more traditional notion of net income, it includes net income & other comprehensive income. Assumption: going concern, revenue recognition & assumption.