Stewardship and Decision Usefulness
Assessment item 1
Short Critical Essays
Question 1 - 750 words
Financial reports (and the conceptual frameworks on which they are based) can either embrace a ‘decision usefulness’ or ‘stewardship’ function. Define these two terms. Which of these functions has the IASB deemed more important in recent years? Critically evaluate whether the approach adopted by the IASB will lead to the provision of relevant and/or reliable information for all users.
Question 2 - 750 words
Identify the weaknesses of historical cost accounting. Were any of the alternatives to historical cost (CPPA/CoCoA/CCA) successful? In your response you will need to outline your criteria for success.
Question 3 - 750 words
Outline the key building blocks of conceptual frameworks. Conceptual Frameworks are yet to provide significant prescription in relation to measurement issues in accounting. Why do you think this is the case? Would you consider conceptual frameworks to have been successful in achieving their objectives? Justify your response.
This assessment task will assess the following learning outcome/s:
- be able to critically evaluate attempts to develop and apply a conceptual framework.
- be able to critically appraise the objectives of accounting and relate them to the various concepts of accounting discussed in earlier subjects.
- be able to analyse the possible usefulness of alternative measurement systems to historical cost.
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