Professional Documents
Culture Documents
Conceptual
Framework
Session 2
AC3091: Financial Reporting
o
Learning Objectives
Conceptual Framework
Conceptual Framework
Conceptual Framework
Conceptual Framework
Advantages
Conceptual Framework
Disadvantages
Conceptual Framework
US FASB
Concept
Statements
(SFAC)
SFAC 4, 5,
6, 7, 8
UK ASB
Statement
of
Principles
for
Financial
Reporting
(SOP)
IASC
Conceptual
Framework
for
Financial
Reporting
10
Assets
Liabilities
Equity
Performance
(changes in
resources & claims)
Income
Expenses
11
Assets
o
r
p
b
12
Liabilities
o
p
of the entity arising from past
events, the settlement of which are expected to
result in o
from the entity of resources
embodying e
[IFRS]
13
Equity
o
r
in the assets of the entity
after deducting all its liabilities [IFRS/FASB]
14
Income [IFRS]
I
during the
accounting period in the form of inflows or
enhancements of assets or decreases of liabilities
that result in increases in equity, other than those
relating to contributions from equity participants
o Includes revenue and gains
o
Revenue:
15
Expenses [IFRS]
D
during the
accounting period in the form of outflows or
depletions of assets or incurrences of liabilities that
result in decreases in equity, other than those
relating to distributions to equity participants
o Includes losses
o
Loss:
16
Probable flow
of economic
benefits
Reliable
measurement
of cost or
value
Recognition
in Financial
Statements
Reliability of measurement
Reasonable
17
Criteria
Asset
Liabilities
Income
Expenses
Financial
Statement
Statement of
Financial Position
Statement of
Profit or Loss &
Other
Comprehensive
Income
18
19
Has
20
10
21
22
11
23
24
Points to note:
An entity whose financial statements comply with
IFRSs shall make an explicit and unreserved
statement of such compliance in the notes
o When preparing financial statements, management
shall make an assessment of an entitys ability to
continue as a going concern
o
Financial
12
25
Points to note:
o
26
Revenue
Finance costs
o Share of profit and losses of associates and joint
ventures accounted for using the equity method
o Single amount comprising the total of (i) the posttax profit or loss of discontinued operations and (ii)
the post-tax gain or loss recognised on the disposal
of the assets or disposal group(s) constituting the
discontinued operation
o
13
27
o Disclosure on
profit or loss for the period attributable to noncontrolling interests and owners of the parent
total comprehensive income attributable to noncontrolling interests and owners of the parent
28
14
29
30
15
31
32
16
33
Current/non-current distinction
o Entity
34
Held primarily for trading purposes or for short term and expected
to be realised within 12 months of balance sheet date; or
CURRENT ASSETS
17
35
Held primarily for trading purposes or for short term and due to be
settled within 12 months of balance sheet date; or
CURRENT LIABILITIES
36
18
37
38
19
39
40
Statement
20
41
Questions
21