To help you become familiar with the accounting standards, this case is designed to take you to the FASB’s Web site and have you access various publications. Access the FASB’s Web site at www.fasb.org. Click on “Pronouncements & EITF Abstracts.” For this case, we will use Statement of Financial Accounting Concepts No. 1. Open Concepts Statement No. 1.
1. Read paragraph 28. Based on information in this paragraph, what group of users benefits most from financial information and why?
2. Read paragraph 34. Based on information in this paragraph, what is assumed about the background and/or education of those who are using financial accounting information?
3. Read paragraph 43. Based on information in this paragraph, those interested in an enterprise’s future cash flows should pay particular attention to information contained in which primary financial statement?