Why Does the IASB Believe That a Principles-Based Approach to Standard

question 53

Multiple Choice

Why does the IASB believe that a principles-based approach to standard setting is superior to a rules-based approach?

• A) Detailed guidance or rules encourage accountants to look for ways around the rules rather than trying to provide useful information.
• B) Principles-based standard setting is less costly to undertake than rules-based standard formulation.
• C) It is desirable to have all corporations in all countries using the same accounting practice.
• D) A conceptual framework for standard setting has demonstrated to encourage the greatest economic development.

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Definitions:

Bell Shaped

Describing a graphical representation of data that exhibits a symmetric distribution around a central peak, resembling the shape of a bell.

Ordered Data Set

A collection of objects or values arranged in a sequence following a specific order, usually numerical or alphabetical.

Observations

Individual data points or measurements collected during a study or experiment.

Histogram

A graphical representation of the distribution of numerical data, showing the frequency of data points within successive intervals.