113a test uno - Essential characteristics 1 identify...

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Essential characteristics 1) identify, measure, comm, 2)economic ent 3) interested parties Obj of fin state: provide wide variety users, 1)Objectives of Fin reporting 2)Qualitative Characteristics3)Elements of Fin. Statements 5)Recognition and Measurement6)Elements of Fin. Statements 7)Cash flow/Present value 8)objective/purpose of financial reporting/ and qualitative char of useful financial info Conceptual framework 1st) basic obj 2)qualitative/ elements 3)recognition, measurement, disclosure, assumpt FASB identify - qualitative char that distinguish better info from inferior for decision making purposes Fundamental quality - relevance: making a difference in decision Ingredients: Predictive : investor future expect. Confirm : confirm/correct prior expectation Material: if omitting it or misstating it could influence decisions that users make on basis of fin: Faithful rep, reliable : numbers/descript match event: don’t omit. Ingredients Completeness: all info Neutality: cannot favor or over/understate Freefromerror-accurate Enhancing quailities: Expense recogn: (matching prin) let expense follow rev. Rev recogn recog rev in period Comparability :GAAP similar manner Verifiability : same conclusion i.e audit Timeliness : reports Understandalbililty : quality of info that let reasonably informed users see signif end Comprehensive : anything that changes equity except inv/contr or nonowner 2 things for revenue recog: earned, realized, Third level: economic entity - comp keep act sep from owner and bus, going concern - company will last long enough to fulfill objective, monetary - money is common denominator, perioditcy - company divide act into period. Measurement : historical cost :benchmark fair value: more useful Full Disclose : fin state, notes, supple 2010 FASB and IASB
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