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What is an Economic Event?

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:

  • The cost of any ingo does not exceed the benefit
  • Info should be easy to use and understand
  • Any info meets user needs
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