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CMA Intermediate · Corporate Accounting and Auditing · Conceptual Framework

Which of the following is a stated purpose of the Conceptual Framework for Financial Reporting under Ind AS?

One stated purpose of the Framework is to help preparers develop consistent accounting policies when no Ind AS applies to a transaction or when an Ind AS permits a choice of policy. It does not prescribe formats, replace audit or deal with tax treatment.

  1. ATo assist preparers in developing consistent accounting policies when no Ind AS applies to a particular transaction or when an Ind AS allows a choice of policyCorrect
  2. BTo prescribe the format of the statement of profit and loss for all companies
  3. CTo replace the need for audit of general purpose financial statements
  4. DTo set out the tax treatment of items of income and expense

Explanation

The stated purposes are to assist ICAI in developing Ind AS based on consistent concepts, to assist preparers in developing consistent accounting policies where no Ind AS applies or a choice exists, and to assist all parties to understand and interpret Ind AS. Formats, audit and tax are not listed.

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