Revised Conceptual Frameworks

Question 1

The Conceptual Framework is intended to establish
a. Accounting standard in financial reporting
b. The meaning of “present fairly in accordance with GAAP”
c. The objectives and concepts for use in developing standards of financial accounting and
reporting
d. The hierarchy of sources of GAAP

Answer 1

c. The objectives and concepts for use in developing standards of financial accounting and
reporting

Question 2

Which is not a purpose of the Revised Conceptual Framework?

a. To assist the IASB to develop IFRS based on consistent concepts.
b. To assist preparers to develop consistent accounting policy when no standard applies to a particular transaction or when Standard allows a choice of accounting policy.
c. To assist all parties to understand and interpret the Standards.
d. To assist regulatory agencies in issuing rules and regulations for a particular industry.

Answer 2

d. To assist regulatory agencies in issuing rules and regulations for a particular industry.

Question 3

Which statement is not true concerning the Conceptual Framework?

a. The Conceptual Framework should be a basis for standard-setting.
b. The Conceptual Framework should allow practical problems to be solved more quickly.
c. In cases of conflict, the Conceptual Framework prevails over the relevant IFRS.
d. The Conceptual Framework should increase users’ understanding and confidence in financial reporting

Answer 3

c. In cases of conflict, the Conceptual Framework prevails over the relevant IFRS.

Question 4

What provides “the why” or the goal and purpose of accounting?

a. Measurement and recognition concept
b. Qualitative characteristic of accounting information
c. The element of financial statements
d. The objective of financial reporting

Answer 4

d. The objective of financial reporting