The conceptual framework provides basic financial reporting objectives, underline the fundamental accounting and financial statement concepts, and provide ways to measure accounting information, recognize financial events and report them in the accounting system. The objectives of financial reporting are to provide financial information about the reporting entity that is useful to present and potential equity investors, lenders and other creditors in making decisions in their capacity as capital providers. Information that is decision-useful to capital providers may also be useful to other users of financial reporting who are not investors.

REQUIRED:

a. Do you agree with the above statement or not? and why?

b. What are the major financial statements in the financial reporting? c. What are the purpose of each statement? d. How each statement does help the users to make their right decision?