Management and Organizational Studies 1023A/B Midterm: Chapter 2 Textbook and lecture

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 1023A/B
• Professor: Barry Hawn

Document Summary

The framework is like a constitution; it is a coherent system of interrelated objectives . Aids in creation of standards for the accounting profession. Increases financial statement users" understanding of and confidence in financial reporting. Enhances comparability of financial statements of different companies. The framework is the foundation for building a set of accounting concepts and objectives. The framework is a reference of basic accounting theory for solving new and emerging practical problems of reporting. The overall objective of financial reporting is to provide information that is: 2. useful to users (e. g. investors, creditors), and decision relevant (resource allocation) Resource allocation decisions are assumed to include assessment of management stewardship (i. e. management role in maximizing shareholder value) Includes all material decision-maker) information (i. e. information that makes a difference to the. Information measured and reported in similar way (company to company, and year to year) Allows users to identify real economic similarities and differences.