BFAR3073 QUIZ 2 - THE CONCEPTUAL FRAMEWORK CHAPTER 3

Information about possible future transactions and other possible future events (forward-looking information) is included in financial statements.

• TRUE

• FALSE

Financial statements include information about transactions and other events that have occurred after the end of the reporting period if providing that information is necessary to meet the objective of financial statements

• TRUE

• FALSE

Financial statements provide information about transactions and other events viewed from the perspective of the reporting entity as a whole, not from the perspective of any particular group of the entity’s existing or potential investors, lenders or other creditors.

• TRUE

• FALSE

Financial statements are normally prepared on the assumption and basis that the reporting entity is a going concern and will continue in operation for the either in a short and long term period.

• TRUE

• FALSE

If a reporting entity is the parent alone, the reporting entity’s financial statements are referred to as ‘unconsolidated financial statements’

• TRUE

• FALSE

Consolidated financial statements provide information about the assets, liabilities, equity, income and expenses of both the parent and its subsidiaries as a separate reporting entity

• TRUE

• FALSE

Consolidated financial statements are not designed to provide separate information about the assets, liabilities, equity, income and expenses of any particular subsidiary

• TRUE

• FALSE

Information provided in unconsolidated financial statements is typically sufficient to meet the information needs of existing and potential investors, lenders and other creditors of the parent.

• TRUE

• FALSE

The objective of financial statements is to provide financial information about the reporting entity’s assets, liabilities, equity, income and expenses that is useful to users of financial statements in assessing the prospects for past and current cash inflows to the reporting entity and in assessing management’s stewardship of the entity’s economic resources

• TRUE

• FALSE

The information disclose in the financial statements is about recognized assets, liabilities, equity, income and expenses including risks arising from those recognized assets and liabilities.

• TRUE

• FALSE