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Conceptual Framework: (Chapter 4: (Asset: Eco Resource, controlled, result…
Conceptual Framework:
Chapter: 1
Objective of General purpose fin reporting is to provide users information to make decisions relating to providing the entity resources
Users decisions are based on returns, assessed based on amount, timing & uncertainty of future CFs & stewardship of management. AFS DO NOT SHOW AN ENTITIES VALUE
Chapter 2:
Fund QC:
Relevance: Can influence users decisions, offers predicive and/or confirmatory value Materiality: If ommitted can influence decision (entity specific)
Faithful representation: Complete: All info for user to understand economic events included. Neutral: Simply unbiased but not meaningless. Supported by prudence in exercising caution in judgement Free from error: Not perfectly correct but rather inputs and models correctly applied to reach conclusions
Applying Fund QC: 1) Identify event 2) Identify relevant info 3) Determine if available info can provide FR 4) If satisified stop, otherwise repeat process till satisfied
Enhancing QC:
Comparibility: Present information in a manner similar to other entities and similarly to last year. Must provide at least 1 year comp figures. Consistency aids achievement
Verifiability: Info can be confirmed directly through observation or indirectly through evaluating inputs. Multiple parties must reach consensus
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Understandibility: Present information in a manner that makes in understandable but do not omit key info to make easy to understand
Chapter 3:
Different types of AFS: 1) P & S = Consol 2) P = Unconsol 3) Two or more parties not all in group = Combined
Unconsol AFS useful because claims against parent usually does give rise to claim against subs. Dividends distributed from funds of parent
Chapter 4:
Asset: Eco Resource, controlled, result of past events. Eco resource right, potential to generate FEBs
par 4.6-4.25 detail considerations
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Unit of Account: Mehtod of grouping rights. Should be done in a manner promoting FRep. Treating set of rights as a unit is not offsetting
Chapter 5:
Recognition criteria: 1)Relevance i) Existence uncertainty ii) Low probability of econ bens flowing 2)FRep i) Measurement uncertainty ii) Other qualitative considerations
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Chapter 6:
Measurement bases: Cost, Current Value, Fair Value, VIU/Fufillment Value, Current Cost
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Considerations in selecting base: 1) Relevance i) Asset/Liability characteristics ii) Contribution to CFs 2)FRep Use base to avoid measurement inconsistency 3) Enancing QC
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