Thursday, 31 January 2013

Objectives of accounting / general purpose financial reporting

Objectives of accounting / general purpose financial reporting 

Updated on 14 January 2014

The objectives of general purpose financial reporting / accounting are

1. "To provide financial information about  the reporting entity that is useful to existing and potential investors, lenders and other creditors in making decisions about providing resources to the entity.”  Conceptual Framework


2. To legalise measurement bases that result in automatic capital maintenance in units of constant purchasing power in terms of an index that follows all (at least DAILY) changes in the general price level for an indefinite period of time in entities that at least break even in real value - ceteris paribusduring low inflation, high inflation, hyperinflation and deflation.

Nicolaas Smith

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