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The FASB’s conceptual framework consists of six Statements of Financial Accounting Concepts. In the "Introductory Comments," the FASB states that the series is designed to "constitute a foundation of financial accounting standards—to prescribe the nature, function, and limits of financial accounting and to be used as a guideline that will lead to consistent standards. These conceptual statements do not establish accounting standards or disclosure practices for particular items (GAAP)." The statements include financial reporting objectives, qualitative characteristics, elements, recognition, measurement, financial statements, earnings, funds flow, and liquidity. The following six Statements make up the Conceptual Framework: Statement of Financial Accounting Concepts No. 1 (FASB, November, 1978) addresses the objectives of financial reporting by business enterprises. About whom, for whom and for what purpose? These are critical questions that need to be answered before one can begin to develop any rules (standards).
Approximate Word count = 548
Approximate Pages = 2.2
(250 words per page double spaced)
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