THE CONCEPTUAL FRAMEWORK FOR FINANCIAL REPORTING
The Conceptual Framework sets out the concepts that underlie the preparation and presentation of financial statements for external users (Conceptual Framework, Section “Purpose and status”). The relationship between the Conceptual Framework and individual IFRSs can be described as follows.
2 THE OBJECTIVE OF GENERAL PURPOSE FINANCIAL REPORTING
The objective of general purpose financial reporting is to provide financial information about the reporting entity that is useful to existing and potential investors, lenders, and other creditors in making decisions about providing resources to the entity (e.g. providing loans to the entity or buying equity instruments of the entity) (OB2).
Existing and potential investors, lenders, and other creditors are the primary users to whom general purpose financial reports are directed (OB5). They require useful information in order to be able to assess the future cash flows of the ...