Writing assignment 1

Writing assignment 1 - 1. On the fifth page, third...

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1. On the fifth page, third paragraph of the Concepts Statement #8 the conceptual framework is described as, “a coherent system of interrelated objectives and fundamental concepts that prescribes the nature, function, and limits of financial accounting and reporting and that is expected to lead to consistent guidance.” This means that the conceptual framework is the structure of both objectives and concepts that explains areas of financial accounting in order to lead to some sort of outlined regulation for accounting in order to keep things unbiased to better serve public interest. There are a couple levels of people who benefit from the conceptual framework. The group that seems to most immediately benefit from the framework is the Board itself because it directs the Board in making accounting decisions. This will then also affect those that deal with generally accepted accounting principles (GAAP) by helping them to better comprehend the information provided by financial accounting. 2. There are a few differences in the frameworks of FASB and IASB. FASB’s framework is much more detailed and in depth than that of IASB. On the other hand, IASB has a more vague set of standards that must be followed. The Board understands that there will be differences in currently established principles to the concepts being set forth as IASB and FASB work together. The Board has recognized these differences and so has set forth that the Concepts Statement does not requiring a change in the existing GAAP, modify the Accounting Standards Codification, or justify changing existing generally accepted accounting practices or “interpreting the Accounting Standards Codification based on personal interpretations of the objectives and concepts in the
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Writing assignment 1 - 1. On the fifth page, third...

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