COMM 217 Lecture Notes - Lecture 2: Accounting Equation, Retained Earnings, Accounts Payable

• School: Concordia University
• Department: Commerce
• Course: COMM 217
• Professor: micheal

Document Summary

Chapter 2: investing and financing decisions and the statement of financial position. Chapter 2"s focus is on the preparation of the statement of financial position (hereafter, sfp) or balance sheet (hereafter, b/s). To fulfill the primary objective of providing useful information, the conceptual framework provides guidance on the essential characteristics that determine the usefulness of accounting information. 1 the international accounting. Preparers consult the conceptual framework for additional guidance on how to apply ifrs (namely principles) in practice. Further, users observe the conceptual framework to unpack a company"s financial statements. It should be noted, the conceptual framework, though, never takes precedence over the provisions contained in ifrs. Enhancing qualitative characteristics (comparability, verifiability, timeliness and understandability) Useful financial information is said to exhibit 4 enhancing qualitative characteristics: comparability: firms" accounting information is comparable when similar accounting methods have been applied to produce said information. Comparability decreases when different reporting standards are used in practice.