Memorandum

Date: 4-11-09Re: Case 3-5A.Discuss the concept of relevancy. In your opinion, would the amounts reported by U.S. companies for property, plant, and equipment be more or less relevant than the occurrent exist amounts reported by companies in England, Mexico, or elsewhere? relevance reading is relevant when it influences the economical terminations of users by helping them value past, invest, and proximo or by confirming or correcting their past evaluations. Relevance is also affected by materiality. Information has the quality of relevance when it is ? assailable of making a difference in the economic decisions of users by helping them evaluate the effect of past and present scourts on future net cash inflows ( prognostic value) or confirm or correct previous evaluations(confirmatory value), even if it is non being employ? (FASB, 2005: 2; FASB 1980: 37). In the IASB framework tuition has the quality of relevance ?when it influences the economic decisions of users by helpi ng them evaluate past, present of future events or confirming, or correcting, their past evaluations? (IASB, 1989: 24). two frameworks thus differentiate that accounting cultivation is relevant if it has the depicted object to make a difference in a decision. The FASB requires information to be undefendable of making a difference in the economic decisions of users ?even if it is not being used?. However, to be relevant the IASB definition additionally requires that information is used i.e.

influences the decision maker in making economic decisions. Another splendid difference in the midst of the FASB and IASB framework is the FASB framework explicitly mentions that relevant informati on has to ingest predictive and feedback va! lue, while the IASB uses these ground implicit in its framework. ?The predictive and confirmatory roles of information are interrelated (IASB,1989: 27). First, the FASB framework defines patness an ancillary aspect of relevance. Information must be for sale when users need it. If you want to charm a full essay, parliamentary procedure it on our website: OrderEssay.net

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