What is the key element of the IASB definition of the reporting entity?

Question

Quizplus · Accepted Answer

The key element of the IASB definition of the reporting entity is the existence of investors and creditors who cannot directly obtain information. This means that the reporting entity has a responsibility to provide financial information that is useful to these external parties. The existence of a broad range of users who want information is not the key element, although it may be a factor in determining the type and format of information provided. Legal requirements of the country may also be a consideration but are not the key element. The existence of scarce resources does not relate to the reporting entity definition.

What Is the Key Element of the IASB Definition of the Reporting