The New Financial Framework

The ongoing framework was approved in July 1989, and was adopted in April 2001 by the IASB. It sets out the concepts concerning the preparation and the presentation of fiscal reports for users which atomic number 18 external to the companionship. However, during these last 2 decades, the market, the line of descent practices, as live only as the economical environment, deem evolved. The current framework, no endless reflecting the business reality, is then creation updated by the IASB and the FASB. The send-off stagecoach of this new Joint conceptual modeling Project, regarding the objectives of financial statements and its soft characteristics was completed on the 28th of December. We will first determine the main strengths and weaknesses of these two sections, and then evaluate the changes that have been made. THE STRENGTHS AND WEAKNESSES OF THE FISRT TWO CURRENT SECTIONS A framework is a statement of generally accepted suppositional principles [] that prov ides the basis for both the ontogenesis of new reporting practices and the rating of existing ones (Ernst & Young, 2009). STRENGTHS ? Informed economic decisions As we said before, the Framework governs published financial statements.

These statements ar intended to provide useable selective breeding to different external users, who have different information needs: it helps them manufacture conscious economic decisions based on reliable information. To enable the users to make these informed decisions, financial statements must(prenominal) show comparability and understandability, as well as secretive re presentation (relevance and reliability): th! ese are the qualitative characteristics given by the Framework. => The current framework and accounting concepts enhances the faithful representation of a companys financial position, and therefore gives the external users the reliable information that they need to make sound decisions. The fist two sections result external users to have a wide view of the company. ? trade protection of the different...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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