ACCOUNTING STANDARD-SETTERS

2.1Accounting standard-setters have an expectation that the readers of general purpose financial reports have a ‘reasonable knowledge’ of accounting. Specifically, the IASB Framework states that ‘users are expected to have a reasonable knowledge of business and economic activities and accounting and a willingness to study the information with reasonable diligence’. Hence, there is an expectation that financial statements are not tailored to meet the needs of people who have not, in some way, studied financial accounting. Students should be encouraged to consider whether this expectation is in itself ‘reasonable’.

2.2As Chapter 2 states, there is an expectation held by accounting standard-setters that users of financial statements have a reasonably sound knowledge of financial accounting. For example, within the IASB Framework (which is also the Australian Accounting Standards Board (AASB) Framework)

2.1Accounting standard-setters have an expectation that the readers of general purpose financial reports have a ‘reasonable knowledge’ of accounting. Specifically, the IASB Framework states that ‘users are expected to have a reasonable knowledge of business and economic activities and accounting and a willingness to study the information with reasonable diligence’. Hence, there is an expectation that financial statements are not tailored to meet the needs of people who have not, in some way, studied financial accounting. Students should be encouraged to consider whether this expectation is in itself ‘reasonable’.

2.2As Chapter 2 states, there is an expectation held by accounting standard-setters that users of financial statements have a reasonably sound knowledge of financial accounting. For example, within the IASB Framework (which is also the Australian Accounting Standards Board (AASB) Framework)