Management and Organizational Studies 1023A/B Chapter Notes - Chapter 2: Financial Statement, Going Concern, Measurement Uncertainty

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 1023A/B
• Professor: Maria Ferraro

Document Summary

Conceptual framework: conceptual framework: coherent system of interrelated objectives and fundamentals that can lead to consistent standards and that prescribes the nature, function and limits of financial accounting and financial statements. Qualitative characteristics of useful information: determine decision usefulness which alternative gives the most useful info for decision-making purposes. 29: must exercise good judgment and professional expertise, representational faithfulness, accounting info is representationally faithful to extent that it reflects underlying economic substance of event/transaction transparency. Info should be complete, neutral and free from material error. Completeness: statements should include all info necessary to: often question of amount of details to be presented. Neutrality: info can"t be selected to favour 1 set of interested. 2. parties over another: info shouldn"t be manipulated in any way, management must use many assumptions because of uncertainty in reporting must use best estimates to estimate amount of revenue that"ll be realized/eventually collected.