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Please provide answer to the following:
Discuss whether faithful representation constitutes more than compliance with accounting standards.
Number 1 – I am not here to provide you with answers to questions like this! there is a wealth of information within study texts and exam questions / answers for you to be able to find the answer for yourself
Number 2 – I am certainly not going to “Discuss whether faithful representation constitutes more than compliance with accounting standards.”
Are you seriously expecting me to write out a discussion answer?
Number 3 – to answer the question (without the discussion!) of course faithful representation constitutes more than compliance with accounting standards! It involves clarity and unambiguity of disclosures in addition to ensuring that disclosured matters cannot be misinterpreted.
If I were to say that, “20 years ago I would get home from work and drink a gallon of beer every evening. But I’m happy to say that nowadays I don’t drink any more” that statement can be read in two ways – either (1) I no longer drink beer, or (2) I still drink a gallon of beer every night, but no more than a gallon
I was asked by my wife to go to the shop …”Get a carton of milk and, if they have any eggs, get ten”
I went home with ten cartons of milk, strictly in accordance with her instructions!
Faithful representation is certainly more than mere compliance with accounting standards – and a lot more than just the simple matters I mentioned at the start of this post
After watching framework lecture…So yes i get that faithful representation complies with accounting standards from your answer.But i dont get your two examples..Please clarify them.
Sorry for ambiguity.The gallon one and its implication on the faithful representation.I get the milk’s example…but how is related to faithful representation,yes i am aware that she said have ten,but which aspect of faithful representation is affected being told of 10 which was not clear?
Why would you go back with 10 cartons of milk when she clearly meant 10 eggs. However, strictly in accordance with instructions, I went back with 10 cartons and no eggs
The point is that innocent sounding sentence construction can easily lead to misunderstanding
Turning that the other way, it is easy to mislead someone simply by careful wording
What’s faithful representation? Surely that’s the painting of a picture that leaves no one in any doubt at all – no ambiguity, no chance of misinterpretation.
But beer and milk examples show just how easy it is to mislead
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