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Conceptual Framework Possible Questions - Coggle Diagram
Conceptual Framework
Possible Questions
Question 1
Objective of Financial Reporting
in Accordance with the Conceptual Framework
Objective of Financial Reporting is
to provide Financial Information about an entity
that is
useful to existing and potential
investors, lenders and other creditors
in making decisions about providing resources to the entity.
For Information to be
considered Useful by Users
in making decisions
what should that
information be about
?
For information to be considered useful by users in making decisions,
it should be about the entity's financial performance, financial position
,and
cash flows
The
entity’s economic resources
,
claims against the entity
and
changes in those resources and claims
How
efficiently
and
effectively
management has
discharged its responsibilities
to use the entity’s economic resources.
Question 2
What is the
role of a junior accountant
in the
financial reporting
team of NSFAS?
The
role of a junior accountant
in the
financial reporting team
of NSFAS is
Ensure compliance
with
accounting standards
and
regulations
Help
analyze financial data
for
decision-making purposes
To
assist with the preparation
of financial statements and reports,
What is the
Purpose of the 2018 Conceptual Framework
?
The
Purpose of the 2018 Conceptual Framework
is to
Provide Guidance
on the
Concepts and Principles
that
underpin Financial Reporting
The
qualitative characteristics
of
useful financial information
And the
Definition, Recognition, Measurement
and
Disclosure
of
Elements of Financial Statement
s.
Including the
Objective of Financial Reporting
Explain the
Relevance of IAS1 Presentation of Financial Statements
for the preparation of financial reports
IAS1 Presentation of Financial Statements
provides guidance on the preparation and presentation of financial statements
, including
The
Format
and
Structure of Financial Statements
The
Required Disclosures.
The
Minimum Content of Financial Statements,
Question 3
What are some of the
key financial indicators
that investors, lenders and other creditors
may use to evaluate an entity's financial performance
and
position
?
Leverage Ratios
Efficiency Ratios
Liquidity Ratios
Such as the
current ratio and quick ratio
can help users
assess the entity's ability to meet its Short-Term Obligations
Profitability Ratios
Such as Return on Assets and Return on Equity
can help users assess the entity's ability to generate profits
from its Asset
How can an
entity's financial policies impact
its
resources, obligations
and
performance
? Provide examples
An
entity's financial policies
can impact its
resources, obligations,
and
performance
in various ways
Conservative revenue recognition policy
may appear
less profitable in the short term
Debt management policies
can
impact an entity's financial position
and performance
Conservative revenue recognition policy
may lead to
greater long-term stability and sustainability
Investment policies
can impact an
entity's financial position and performance
Aggressive revenue recognition policy
may lead to f
uture financial difficulties
if revenue is not sustainable
Dividend policies
can impact an
entity's financial position and performance.
Aggressive revenue recognition policy
can
inflate reported revenue
in the short term
Question 4
The
key financial indicators
that the
entity should focus
on in the Annual Report
NSFAS should
provide a breakdown of its expenses by category
, such as:
Administration
Operations
Student support
NSFAS should provide a breakdown
of its revenue sources, such as:
Donations
Investment income
Government funding
Key financial indicators that NSFAS
should focus on in the Annual Report include:
Cash flow
Asset
and
liability
balances
Revenue
and
expenses
Compliance with financial regulations
and
standards
NSFAS should
disclose its asset and liability balances
to give stakeholders
a sense of its financial position