In a Principles-Based Standard-Setting System (Such as Canadian GAAP), Compared

question 5

Multiple Choice

In a principles-based standard-setting system (such as Canadian GAAP) , compared to a rules-based approach (such as U.S.GAAP) ,

• A)since it is more prescriptive, it may be easier to defend how to account for a particular item.
• B)there is a rule for every situation.
• C)accountants either apply specific standards based on the conceptual framework, or, professional judgement consistent with the framework.
• D)it is expected that professional accountants might encounter situations where they are unable to apply the principles appropriately.

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Definitions:

Routine Replies

Standard responses to common inquiries or situations, often used in customer service and communication protocols.

Indirect Approach

A communication strategy that presents supporting details first, leading up to the main point or request, often used to soften the impact of negative news.

Main Idea

The central or most important thought, concept, or argument that is being conveyed in a text or discourse.

Request For Action

A directive or plea issued to prompt someone to take a specific action or make a decision.