38 Questions
What is the main underlying assumption in preparing financial statements?
Going concern
The IASB's Conceptual Framework provides the basis for its IFRSs.
True
What is the aim of achieving a balance between qualitative characteristics in financial statements?
To meet the objective of financial statements.
In preparing financial statements, accountants follow certain fundamental ______________.
assumptions
Match the qualitative characteristics with their descriptions:
Comparability = Ability to compare financial information Verifiability = Ability to verify financial information Timeliness = Provision of financial information in a timely manner Faithful representation = Provision of financial information that faithfully represents the economic phenomena
The Conceptual Framework states that _______________ characteristics are the attributes that make the information provided in financial statements useful to users.
qualitative
What is the main underlying assumption of the IASB's Conceptual Framework?
Going concern
The Conceptual Framework states that the four enhancing qualitative characteristics are relevance, reliability, comparability, and consistency.
False
What is the aim of balancing qualitative characteristics in financial statements?
To achieve an appropriate balance to meet the objective of financial statements
The business entity concept states that the financial affairs of the business should be separated from the affairs of the ______________.
owner
Match the qualitative characteristics with their definitions:
Understandability = The characteristic that makes information easy to grasp Verifiability = The characteristic that ensures information is accurate and reliable Timeliness = The characteristic that ensures information is available in time to influence decisions Comparability = The characteristic that enables users to identify similarities and differences between entities
Which qualitative characteristic is about ensuring information is available in time to influence decisions?
Timeliness
The IASB's Conceptual Framework provides the basis for only some IFRSs.
False
What is the concept that should be considered if the owner of a business takes goods from inventory for their own personal use?
The business entity concept
Which of the following statements correctly describes the contents of a Balance Sheet?
A list of all the assets owned and all the liabilities owed by a business
What is the name of the organization that issues the International Financial Reporting Standards?
International Accounting Standards Board
The IFRS Foundation logo is a Trade Mark of the IFRS Foundation.
True
In a partnership, the partners' individual exposure to debt is limited.
False
What is the primary purpose of a Statement of Profit or Loss?
To record income generated and expenditure incurred over a given period
What is the purpose of the IFRS Foundation?
It is the organization that issues the International Financial Reporting Standards.
A ______________ is a record of the amount of cash generated and used by a company in a given period.
Cash Flow Statement
The International Financial Reporting Standards are issued by the _______________________.
International Accounting Standards Board
Which of the following statements is true about directors of companies?
They have a duty of care to show reasonable competence in their management of the affairs of a company.
Match the following organizations with their descriptions:
IASB = Issues the International Financial Reporting Standards BPP Learning Media = Grateful for permission to reproduce extracts from the International Financial Reporting Standards IFRS Foundation = Holds the Trade Marks of the IFRS Foundation logo and others
What is the address of the International Accounting Standards Board?
30 Cannon Street, London, EC4M 6XH, United Kingdom
Financial statements for a partnership must be produced and made public by law.
False
Match the following financial statements with their primary purpose:
Balance Sheet = Provides a snapshot of the company's financial position at a specific point in time. Statement of Profit or Loss = Provides a summary of the company's revenues and expenses over a specific period of time. Cash Flow Statement = Provides information about the company's inflows and outflows of cash. Ledger = A list of ledger balances shown in debit and credit columns.
BPP Learning Media is the organization that issues the International Financial Reporting Standards.
False
What is the main characteristic of a partnership?
A partnership is not a separate legal entity from the partners themselves.
What is the role of the ACCA examining team in reviewing the revision materials?
To ensure the material properly covers the syllabus and study guide outcomes in the appropriate breadth and depth
The ACCA examining team reviews the revision materials to ensure they cover the entire syllabus.
False
What is the purpose of the question index in the revision materials?
To help plan revision
BPP Learning Media is an ACCA _______________________ Content Provider.
Approved
Match the following features of the revision materials with their descriptions:
Full question index = Helps plan revision Two mock exams = Provides practice at coping with the pressures of the exam day ACCA examining team's review = Ensures the material covers the syllabus and study guide outcomes in the appropriate breadth and depth
The revision materials are reviewed by the ACCA examining team to ensure they are error-free.
False
What is recommended to practice coping with the pressures of the exam day?
Attempting two mock exams
What is the purpose of the ACCA Approved Content Provider?
Provides ACCA-approved support for revision
Study Notes
International Financial Reporting Standards (IFRS)
- IFRS Foundation publishes International Financial Reporting Standards, including International Accounting Standards, SIC, and IFRIC Interpretations.
- The Standards and accompanying documents are issued by the International Accounting Standards Board (IASB).
Copyright and Disclaimer
- No part of the publication can be translated, reprinted, reproduced, or utilized in any form without prior permission in writing from the IFRS Foundation.
- The IFRS Foundation logo, IASB logo, and other trade marks are owned by the IFRS Foundation.
BPP Learning Media
- BPP Learning Media is an ACCA Approved Content Provider.
- The ACCA examining team reviews BPP Learning Media materials to ensure they cover the syllabus and study guide outcomes.
- The review does not guarantee that every eventuality, combination, or application of examinable topics is addressed.
Financial Accounting
- A list of ledger balances shown in debit and credit columns is not a correct description of the Statement of Profit or Loss.
- The Statement of Profit or Loss is a record of income generated and expenditure incurred over a given period.
- Partnerships are not separate legal entities from the partners themselves.
- Directors of companies have a duty of care to show reasonable competence in their management of the affairs of a company.
Qualitative Characteristics of Financial Information
- The IASB's Conceptual Framework provides the basis for its IFRSs.
- The main underlying assumption is going concern.
- The Conceptual Framework states that qualitative characteristics are the attributes that make the information provided in financial statements useful to users.
- The four enhancing qualitative characteristics are understandability, verifiability, timeliness, and comparability.
- Other important qualitative characteristics and concepts include materiality, prudence, consistency, and the business entity concept.
- A trade-off between qualitative characteristics is often necessary to achieve an appropriate balance to meet the objective of financial statements.
Accounting Concepts
- The business entity concept should be considered if the owner of a business takes goods from inventory for their own personal use.
- The accruals concept governs the recognition of sales revenue when goods and services have been supplied and costs are incurred when goods and services have been received.
Learn about International Financial Reporting Standards, including International Accounting Standards, SIC, and IFRIC Interpretations, and their publication by the IASB.
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