Management and Organizational Studies 1023A/B Chapter Notes - Chapter 2: Financial Statement, Income Statement, Current Liability

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

Document Summary

Constitutional framework-is a 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. 1- must build on an established body of concepts and objectives. Able to issue consistent and useful standards over time. Coherent standards and rules are the result as they are built on same standard. Goal is to increase financial users understanding in financial reporting and that it enhance comparability of different company financial statements. 2- solve new and emerging practical problems faster using good judgement and universally accepted framework accountants can make proper decisions. Iasb and fasb tried to make a generally accepted framework. Level 2- a) qualitative characteristics and b)elements of financial statements (assets, liabilities, equity, revenue, expenses, gains and losses) Level 3-fondational principles (how? ) establishing and applying principles.