The conceptual framework of accounting should have many positive effects as new accounting standards are developed. Which of the following is not one of those effects?
A) Financial statements among companies and industries should be more consistent and comparable.
B) Standard setting should be more consistent with an overall statement of the objectives and concepts of financial reporting.
C) Users' understanding and confidence in financial statements should increase.
D) Management should have greater latitude in choosing among accounting alternatives.
E) Accountants should be better able to assess the validity of different accounting alternatives for similar and dissimilar transactions and events.

Question

Quizplus · Accepted Answer

The conceptual framework of accounting is meant to provide guidance and structure for accounting standards, helping to increase consistency and comparability of financial statements, improve standard setting, increase users' understanding and confidence, and assist accountants in assessing the validity of different accounting alternatives. However, it does not give management greater latitude in choosing among accounting alternatives; rather, it provides a basis for consistent and objective accounting choices.

The Conceptual Framework of Accounting Should Have Many Positive Effects