The IASB Conceptual Framework for Financial Reporting Describes the Basic

question 3

Multiple Choice

The IASB conceptual framework for financial reporting describes the basic concepts that underlie financial statements and defines:

• A) the principles for measurement;
• B) disclosure principles;
• C) the elements of financial statements
• D) accounting recognition criteria.

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Definitions:

Management Compensation

The payment or remuneration provided to executives and managers for their services to an organization.

Corporate Policy

Guidelines and rules established by a company to govern its activities and decisions, reflecting its culture and objectives.

Business Judgment Rule

A legal principle that protects corporate directors and officers from liability for decisions made in good faith which they believed to be in the best interest of the company.

Duty of Diligence

The obligation of a person or entity to exercise reasonable care and attention in carrying out tasks and responsibilities.