An economic event is any change in value of an economic resource or the transfer of control of such a respurce from one party to another.
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What is Accounting?
Accounting refers to the process of classifying, interpreting, summarising and reporting on transactions and other economic event.
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What Accountants do
Accountants prepare reports for a range if decision makers and stakeholders.
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4 characteristics which makes information useful
4 Characteristics that make information useful:
Relevance- info is relevant if it helps makes decisions
Reliability- info is reliableif its free of error and bias
Comparability- info must be comparable with similar info from other organisations
Understandability- info should be expressed clearly and in a form that users can understand
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ISABS and IFRSs
The International Accounting Standards Board (IASB) is an independent, private sector body that develops and approves International Financial Reporting Standards (IFRSs). IFRSs are the rules that govern modern accoynting.
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ISAB's fundemental characteristics
ISAB identifies 2 fundemental characteristics that underlie useful info:
Relevance- defined as having 'predictive or confirmary value'
Faithful Representative- defined as 'complete, neutral and free from error'
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3 further qualities of useful info
Further 3 qualities that also underlie useful info:
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