What is the definition of the 'conceptual framework'?
A) A set of prescriptions of what accounting should be
B) A structured positive theory of accounting
C) A coherent system of objectives and fundamentals that are expected to lead to consistent standards
D) 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 accounting standards. It serves as a reference point for standard-setting and helps in understanding and interpreting specific accounting issues.

Option A is not entirely correct as a conceptual framework is not just a set of prescriptions but rather a theoretical construct used to develop principles and standards. Option B is also incorrect as a conceptual framework is not a positive theory but rather a normative theory. Option D is an incomplete definition and does not capture the essence of a conceptual framework.

What Is the Definition of the 'Conceptual Framework