ACCA FR Syllabus A. The Conceptual And Regulatory Framework - Is there an alternative system? - Notes ^{2 / 8}

WITHOUT a principles based conceptual framework

The following happens..

1. Inconsistent standards

2. Standards produced on a "fire fighting" basis

   (Being reactive rather than proactive)

3. Standard setting bodies are biased in their membership

4. Same theoretical issues are repeated each time a problem comes up

Having no framework leads to ‘rules- based’ accounting systems

Such a system is very prescriptive and inflexible, though also the accounts are then more comparable and consistent.