LO1: understand the impact of international standardisation on reporting practices.
LO2: demonstrate an understanding of contemporary measurement issues in financial reporting and their application in practice.
Read the following statement and answer the question:
“Prudence in accounting and financial reporting has a long-established track record. There is a considerable debate about whether International Financial Reporting Standards (IFRS), as the key global standards, should include prudence and state its importance in their conceptual framework” (ACCA, 2014*).
Critically discuss the debate about the inclusion of the prudence concept in the conceptual framework and IFRS.