This document discusses concepts from SFAC 7 and 8 regarding accounting theory and measurement. It provides definitions and principles for key concepts such as present value, fair value, liability measurement, and asset measurement. The goals of financial reporting according to SFAC 8 are to provide useful information to investors, creditors, and other users for decision making. Such information includes reporting on an entity's financial position and cash flows. Qualitative characteristics like relevance and reliability are also discussed. SFAC 8 establishes that the fundamental qualitative characteristics for financial information are representation and relevance. Relevant information must be predictive of future outcomes or allow for performance evaluation. Representation means information is complete, neutral, and free from error.

1. ACCOUNTING THEORY

2. SFAC 7 & 8
RENZY PERMATA SARI
HARFINA AULYA
AGNES NURSELLA
RUTH MAGDALENA

3. Measurement in accounting by
using the present value can be
used to capture and to develop the
difference between the expected
cash flow in the future
Providing relevant information
through financial reporting as
describe some of the attributes
present value measurement of
assets and liabilities logically.
GOALS OF SFAC
NO. 7

4. international1
37

5. IAS 37 establishes accounting and disclosure
requirements for provisions, contingent
liabilities and contingent assets, with some
exceptions, establishes the important principle
that the provision should be recognized only
when the entity has a liability provisions.

6. PRESENT VALUE
FAIR VALUE

7. The present value is the only goal, a
statement which distinguishes Present
Value established to capture the elements
that taken together will describe the
market price, and if one does not exist, it
will describe the fair value.

8. 1. The interest rate and the estimated
cash flows
2. The interest rate used to discount
flows
3. Estimated cash flow interest rate
GENERAL PRINCIPLES

9. RELEVANCE
REALIBILITY
RELEVANCE AND RELIABILITY MUST BE
BALANCED AGAINST ISSUES THAT
DIFFERENTIATE FROM ONE ANOTHER. IT IS
IMPORTANT TO UNDERSTAND, THAT THE
ISSUES CONCERNING THE QUALITY WILL
PROVIDE DIFFERENT LOAD EVEN EXCHANGED
FROM ONE SITUATION TO THE NEXT.

10. MEASUREMENT APPROACH
TOUSING PRESENT VALUE

11. CONCEPT OF
LIABILITY
MEASUREMENT
ASSET
MEASUREMENT LIABILITY

12. FAIR VALUE
KEWAJIBAN
ASSET
VALUE
PRESENT VALUE
to assess the value of current assets recognized for
the purpose of guaranteeing that the obligation
involving the owner or admitted liability in the entity
by an amount comparable

13. DEBT POSITION OF
THE ENTITY
RELEVANT OBLIGATION
SIZE

14. Statements of Financial Accounting Concept framework
no.8 for financial reporting (Conceptual framework for
financial reporting)
SFAC No. 8 is one of a series of publications on the FASB's
financial accounting and reporting for the conceptual
framework chapter includes two new ones that replaced
the SFAC No. 1, objectives of financial reporting by
Business Enterprises, and the SFAC No. 2, qualitative
characteristics of accounting information. SFAC No.8 is
meant to set the goals and fundamental concepts that
would become the basis for the development of financial
accounting and reporting guidelines

15. In general the content and purpose of the SFAC no 8 is
1. The first results of the project with the IASB in
formulating basic concepts of financial accounting
2. Replace SFAC no 1 & 2
3. Consist 3 chapters
1. Chapter 1 financial reporting purposes common purpose
2. Chapter 2 reporting entity
3. Chapter 3 characteristic of qualitative financial
information useful

16. Sfac no.8 in general formulated three
the purpose of financial reporting
1. Provides information about financial reporting entity that are useful for
investors, lenders and creditor existing and potential in making decisions on
resources supply to entity rapporteur
2. To assess the prospects of net cash flow, which is owned by an entity, existing
investors and potential investors, lenders and other creditors who need
information about the resources of the entity, the entity's claims, and how
efficient and effective management of the entity conducting management and
Commissioners who have completed their responsibility to use resources of
entities
3. 3. common purpose financial report provides information about financial
reporting position of an entity, namely information about to economy resources
and claims against the economic resources in reporting entity

17. Primary users
Observed from financial reporting purposes an entity that is
recommended in sfac no.8 it seemed that users of financial
information which serves to precedence
1. investors and potential investors
2. the creditors and prospective creditors. Investors and
creditors are parties who provide resources for an entity but
does not have direct access to the information needed

18. Information needed
Direction and types of information
required by investors and creditors
namely
• Investors and creditors requires
information that could help they
judge net cash flow prospects an
entity in the future
• Information about reporting
economy resources an entity,
changes and a claim for resources
• Changes and claims over resources

19. Characteristic of qualitative
information
The qualitative characteristics of useful financial
information consists of, identify the types of
information that may be useful to existing creditors
and potential investors and other lenders to make
decisions about an entity reporting based on
information possessed in the form of financial
statements
There are constraints related to financial reporting
capability to provide useful information, i.e. by taking
action against barriers that could differ on kos various
types of information. The information will be useful
when is relevant and appropriately represented

20. Fundamental characteristic qualitative
SFAC No. 8 establishes the fundamental
qualitative characteristics of element is the
exact representation and relevance

21. relevance
Relevant financial information is capable of
making a difference in decision-making by
the user. The information is said to be
relevant when such information has the
quality criteria, among others
• Predictive value, information is said to have
value predictif if can be used as an input for
a process used by users to predict the
outcome of the future.
• Value confirmatory, financial information is
said to have value confirmation if it can
provide feedback about evaluation formerly
or both

22. Three characteristics in perfect
information representation
1. Complete, which includes all the information
necessary for the user to understand the
phenomenon that is being described as
including all the necessary explanation and
description
2. Neutral, describing selection or the
presentation of financial information without
bias in the sense not sloping, weighted,
emphasize, wearing a race, or manipulated to
increase the probability that financial
information will be received good or not by
the user information
3. Error free, i.e. There are no errors or omissions
in the description of the phenomenon and the
process used to generate the information that
is reported to have been selected and applied
with no errors in the process

23. Apply a qualitative fundamental
characteristics
• Identify an economic phenomenon has the
potential to be useful to the users of financial
information that reporting entities
• Identify kind of information about the
phenomenon to be relevant if available and
can any represented

24. Increase characteristic qualitative
• It can be compared, allowing users
to identify and understand the
similarities and differences between
the items of the financial statement
• Verifiable, means that an observer
knowledgeable and independent
different bias reach consensus
though not necessarily complete
agreement that is an faithful
depiction of certain

25. Punctuality mean having
information available to make
decisions within the time will be
able to renew their decisions. The
longer information then the
information become less useful
Can be understood, namely
classify, characterize, and presenting
information in a clear manner and
concise will make the information
could ever be understood

26. THANK YOU