Page 134 - DCOM409_CONTEMPORARY_ACCOUNTING

Unit 10: IFRS and its Relevance

standard-setting process, regulators or others - and be indicative of the qualities that users Notes
can expect of the financial information provided to them.

General purpose financial reporting involves making decisions about the selection of
financial information to be included in general purpose financial reports, the measurement
of that information and its presentation.

10.7 Keywords

Accounting Standards: Accounting standards are the basis of accounting policies and practices
to facilitate the recording of transactions and events in such a way which can change them into
financial statements, to be used by the persons interested in getting the correct and reliable
information with a view to take future decisions.

Financial Statements: Financial statements are the most important way of periodically presenting
to parties outside the business the information that has been gathered and processed in the
accounting system.

IASB: International Accounting Standards Board
IFRS: International Financial Reporting Standards

10.8 Review Questions

1. The term International Financial Reporting Standards (IFRSs) has both a narrow and a
broad meaning. Discuss.
2. Write a note on organisation structure of IASB.
3. Why accounting standards are important in preparing the financial statements?

4. The standards issued by IASB were named as International Financial Reporting Standards
(IFRS). What are the key standards issued by IASB?
5. What are the key benefits of using IFRS?

6. Identify the key characteristics of IFRS financial statements.
7. Discuss the meaning and scope of IFRS 7.
8. What are the key challenges in implementation of IFRS in India?

Answers: Self Assessment

1. true 2. false
3. false 4. true

5. IFRS 2 6. discontinued
7. GAAP 8. IFRS 7
9. Relevance 10. Understandability
11. comparability 12. For value

13. Disclosure

LOVELY PROFESSIONAL UNIVERSITY 129