What is the definition of a 'conceptual framework'?
A) A conceptual framework is a set of prescriptions of what accounting should be.
B) A conceptual framework is a structured positive theory of accounting.
C) A conceptual framework is a coherent system of objectives and fundamentals that are expected to lead to consistent standards.
D) A conceptual framework is a group of independent concepts on specific accounting issues, that are grouped together to provide a single reference.

Question

Quizplus · Accepted Answer

A conceptual framework is a coherent system of objectives and fundamentals that are expected to lead to consistent standards. It provides a foundation for developing accounting standards and resolving accounting issues by providing a common set of concepts, definitions, and principles. It aims to enhance the usefulness and reliability of financial information by ensuring consistency in accounting practices. Option A is incorrect as a conceptual framework is a descriptive tool, not a prescriptive one. Option B is incorrect as it describes a positive theory, not a conceptual framework. Option D is incorrect as a conceptual framework is a holistic framework, not a group of independent concepts.

What Is the Definition of a 'Conceptual Framework