Which of the following statements is correct in relation to the assumptions to be made when preparing financial reports?

Question

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The assumption that financial reports are prepared on a going concern basis is a fundamental assumption in accounting. While the conceptual framework may require other assumptions to be made, this specific assumption is universally accepted and applies to all financial reports. Options A and D are incorrect as they are either too broad or not applicable to assumptions in financial reporting. Option B is completely incorrect as assumptions are necessary in financial reporting to ensure consistency and comparability.

Which of the Following Statements Is Correct in Relation to the Assumptions