Question

From a critical perspective, what is the role of the IASB Conceptual Framework for Financial Reporting?

Answer 1

Answer:

The International Accounting Standards Board (IASB) has published its revised 'Conceptual Framework for Financial Reporting'. Included are revised definitions of an asset and a liability as well as new guidance on measurement and derecognition, presentation and disclosure. The new Conceptual Framework does not constitute a substantial revision of the document as was originally intended when the project was first taken up in 2004. Instead the IASB focused on topics that were not yet covered or that showed obvious shortcomings that needed to be dealt with.
The 2018 Conceptual Framework is structured into an introductory explanation on the status and purpose of the Conceptual Framework.
The primary purpose of the Conceptual Framework was to assist the IASB in the development of future IFRSs and in its review of existing IFRSs The Conceptual Framework may also assist preparers of financial statements in developing accounting policies for transactions or events not covered by existing standards In rare cases, the IASB might need to issue a new or revised IFRS that conflicts with some aspects of the Conceptual Framework. If so, the IASB would need to describe and explain that departure from the Framework in the basis for conclusions on the IFRS?