- CFA Exams
- 2023 Level I
- Topic 3. Financial Statement Analysis
- Learning Module 17. Financial Reporting Standards
- Subject 1. The Objective of Financial Reporting
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Subject 1. The Objective of Financial Reporting PDF Download
An awareness of the reporting framework underlying financial reports can assist in security valuation and other financial analysis. This framework describes the objectives of financial reporting, desirable characteristics for financial reports, the elements of financial reports, and the underlying assumptions and constraints of financial reporting. An understanding of the framework that is broader than knowledge of a particular set of rules offers an analyst a basis from which to infer the proper financial reporting, and thus security valuation implications, of any financial statement element transaction.
The objective of financial reporting:
- The objective of financial statements is to provide information about a company's financial position, performance, and any changes in financial position; this information should be useful to a wide range of end-users for the purpose of making economic decisions.
- Financial reporting requires policy choices and estimates. These choices and estimates require judgment, which can vary from one preparer to the next. Accordingly, standards are needed to attempt to ensure some type of consistency in these judgments.
Learning Outcome Statementsdescribe the objective of financial reporting and the importance of financial reporting standards in security analysis and valuation;
CFA® 2023 Level I Curriculum, Volume 2, Module 17
User Contributed Comments 1
|lordcomas||To provide Information about a company's financial position, performance and its changes.|
I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
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