Chapter 2 Class Notes

Chapter 2 Class Notes - Chapter 2 CONCEPTUAL FRAMEWORK...

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Chapter 2 CONCEPTUAL FRAMEWORK UNDERLYING FINANCIAL ACCOUNTING Upon its creation, the members of the FASB felt it was important to develop a Conceptual Framework to enable the FASB to issue more useful and consistent pronouncements over time. This would result in a coherent set of GAAP. The Board members believed the framework would increase financial statement users’ understanding of and confidence in financial reporting and that it would enhance comparability among companies’ financial statements. In 1976 the FASB began to develop a conceptual framework that would be the basis for setting accounting rules and for resolving financial reporting controversies. The FASB has since issued several Statements of Financial Accounting Concepts (SFAC) that relate to financial reporting for business enterprises. They are: SFAC No. 1 - Objectives of Financial Reporting by Business Enterprises SFAC No. 2 - Qualitative Characteristics of Accounting Information SFAC No. 3 - Elements of Financial Statements (superseded by SFAC No. 6)
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Chapter 2 Class Notes - Chapter 2 CONCEPTUAL FRAMEWORK...

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