The Conceptual Framework for Financial Reporting (IFRS Framework) establishes the fundamental concepts for preparing financial statements according to IFRS. It describes the basic principles and guidance for presentation, recognizes that it underwent name changes and updates over time, and is not a standard itself but provides important guidance. The IFRS Framework consists of 4 chapters that cover the objectives of general purpose financial reporting, the reporting entity, qualitative characteristics of useful financial information, and the remaining text from the 1989 framework.

1. *

2. The Conceptual Framework for the Financial Reporting
(IFRS Framework) serves as a pillar on which the whole
IFRS stand.
• It describes the basic principles for presentation and preparation of
financial statements in line with IFRS.
• a “must-read” document prior to any other IFRS or IAS standard.
The IFRS Framework underwent certain changes over
past years.
• Previously called “Framework for the Preparation and Presentation of
Financial Statements”.
• Last update happened in September 2010, … please check our MFRS
The IFRS Framework itself is not a standard, but it is
important - gives the users guidance of how the financial
statements shall be prepared.
IFRS Framework consists of 4 chapters
Source: www.IFRSbox.com

3. Chapter
1
Source: www.IFRSbox.com
The objective of General
Purpose
Financial Reporting
Chapter
2
The
Reporting Entity
Chapter
3
Qualitative
Characteristics of
Useful
Financial Information
Chapter
4
The 1989
Framework: The
Remaining Text
- 5 main parts

4. ASSUMPTIONS
1. Economic
entity
2. Going
concern
3. Monetary unit
4. Periodicity
5. Accrual
PRINCIPLES
1. Measurement
2. Revenue
recognition
3. Expense
recognition
4. Full disclosure
CONSTRAINTS
1. Cost
2. Materiality
ELEMENTS
1. Assets
2. Liabilities
3. Equity
4. Income
5. Expenses
OBJECTIVE
Provide information
about the reporting
entity that is useful
to present and
potential
equity investors,
lenders, and other
creditors in their
capacity as capital
Providers.
Second level
First level
Third
level
QUALITATIVE
CHARACTERIS
TICS
1. Fundamen
tal qualities
2. Enhancing
qualities