Question 1

The mission of the FASB is to establish and improve standards of financial accounting and reporting for the guidance and education of the public, including issuers, auditors and users of financial information. In attempting to accomplish this mission, the FASB seeks to

1. Improve the usefulness of financial information reporting by focusing on the primary characteristics of relevance and faithful representation and on the qualities of comparability and consistency.

2. Keep standards current to reflect changes in methods of doing business and changes in the economic environment.

3. Consider promptly any significant areas of deficiency reporting that might be improved through the standard setting process.

4. Promote the international comparability of accounting standards concurrent with improving the quality of financial reporting.

5. Improve the common understanding of the nature and purposes of information contained in financial reports.

Required: Discuss how the FASB has (or has not) accomplished its mission.

Question 3:

Discuss the current operating performance concept of income and the all-inclusive concept of income. Is comprehensive income consistent with either of the two? Discuss why or why not.

Question 2

What are the major changes between Statement of Financial Accounting Concept 2 and Statement of Financial Accounting Concept 8, which superseded Statement of Financial Accounting Concepts 1 and 2?

Question 4

Of the different research methodologies (Deductive Approach, Inductive Approach, Pragmatic Approach and Scientific Method of Inquiry) which one do you believe has the most applicability to accounting practice? Discuss why.