What is the ASBs Statement of Principles for Financial Reporting? What role does it play in the setting of accounting standards?
An Exposure Draft of the Statement of Principles for Financial Reporting was published on 11 March 1999 for public comment by 11 June. The Statement of Principles is a description of the fundamental approach that the ASB believes should, in principle, underpin the financial statements of profit-oriented entities. The Statement is intended to be a comprehensive and reasonably detailed description of that approach, and the approach itself is intended to be internally consistent, up-to-date and in line with the approaches adopted elsewhere in the world. Although the Statement describes fundamental principles, it does not contain requirements on how financial statements should be prepared or presented. (Company accounts will therefore continue to be prepared under the requirements of company law and accounting standards.) Instead, the Statement’s primary purpose is to provide a frame of reference to help the ASB as a standard-setter in developing and reviewing accounting standards. As such
