Financial Reporting Standards Around the World

 The International Accounting Rules Board (IASB) has adopted standards and interpretations known as international financial reporting standards (IFRS) (IASB).

Many of the standards included in IFRS were previously known as International Accounting Standards (IAS). The board of the International Accounting Standards Committee issued IAS between 1973 and 2001. (IASC). The IASB adopted all IAS in April 2001 and continues to enhance them, naming the new standards IFRS.

Financial statements' purpose

According to the framework, the purpose of financial statements is to offer details about an entity's financial situation, performance, and changes in financial status that may be used by a variety of users to help them make economic decisions.

Basic presumptions

The underlying theories utilized by IFRS are

• The impact of transactions and other events is recognized on an accrual basis, rather than when cash is received or paid.
• A going concern is a business for which it is expected that operations will continue for the foreseeable future.

Financial statements' qualitative features The Framework lists the following as the qualitative traits of financial statements:

• Understandability
• Relevance
• Comparability and dependability.

Financial statement components
The Statement of Financial Position (Balance Sheet) is described in the Framework as including the following:-

• Assets - resources that the entity controls as a result of previous occurrences and from which it anticipates receiving future financial gains.
• Liabilities - a duty that the entity has now that was brought about by previous events and whose resolution is anticipated to cause the firm to expend resources that will bring about economic advantages.
• Equity - the entity's remaining stake in its assets following the deduction of all of its liabilities, as shown by the income statement's statement of comprehensive income:
• Income is a rise in profits during the accounting period, whether through inflows, improvements to assets, or decreases in liabilities..
• Expenses declines in these economic advantages.

Recognizing financial statement components
when an item is acknowledged in the financial accounts.:-

• it is likely that an entity will receive or provide a future economic gain, and
• when the item can be reliably measured in terms of cost or value

Measurement of the Elements of Financial Statements
Measurement is how the responsible accountant determine the monetary values at which items are to be valued in the income statement and balance sheet. The basis of measurement has to be selected by the responsible accountant.
Accountants employ different measurement bases to different degrees and in varying combinations. They include, but are not limited to:

• Historical cost
• Current cost
• Realizable (settlement) value
• Present value

Capital and capital maintenance concepts
Concepts of Capital
Financial terminology for capital, such as invested cash or invested purchasing power, refers to the entity's net assets or equity as capital. According to a physical definition of capital, it is the entity's capacity for production..
Defining Profit and Understanding Capital Maintenance Concepts
Accounting professionals have the option of keeping financial capital in either nominal money units or units of fixed purchasing power. When productive capacity is higher than it was at the beginning of the period, physical capital is preserved. The way asset and liability price change effects are handled differs significantly between the two notions. Profit is what remains after the money from the beginning of the time has been kept afloat. The rise in nominal capital is the profit when accountants use nominal monetary units.
The increase in invested purchasing power is the profit for the period when units of constant purchasing power are used by accountants. Only gains that exceed the rate of inflation are considered profitable. increases up to inflation level while maintaining capital and turning to equity.