Accounting Theory (conceptual framework)

Assignment Questions for Accounting Theory

6.29 The IASB Conceptual Framework states that the fundamental qualitative characteristics of useful information are relevance and representational faithfulness. Must both of these qualitative characteristics be satisfied before particular information is included within a financial report? Explain your answer.

6.30 The FASB and IASB state:

The long-standing unresolved controversy about which measurement attribute to adopt particularly between historical-price and current-price measures and the unresolved puzzle of unit of account are likely to make measurement one of the most challenging parts of this project.

Provide an explanation of why measurement will be one of the most ‘challenging’ of the conceptual framework being developed by IASB.