Management and Organizational Studies 1023A/B Chapter Notes - Chapter 2: Accountant, Financial Statement, Resource Allocation

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

Document Summary

Conceptual framework interrelated objectives and fundamentals that can lead to consistent standards and that prescribes the nature, function, and limits of financial. A conceptual framework is like a constitution: it is a (cid:498)coherent system of accounting and financial statements(cid:499: this framework increases financial statement users" understanding concepts and objectives. Its possible to add useful and consistent standards over time and confidence and enhances the comparability of different companies. To be useful, standard setting should build on an established body of: resulting in a coherent set of standards, built on the same foundation. When there are new and emerging practical problems it is easier to solve them with an existing framework. By using good judgement and having a universally accepted conceptual framework, practicing accountants can solve day to day problems. It was decided that there needed to be a conceptual framework that addressed major issues and resolved financial reporting controversies. ***know the overview of the conceptual framework pyramid: first level: