The Nature Of Conceptual Framework Of Financial Accounting

2- Theoretical literature
2-1- The Nature of Conceptual Framework of Financial reporting
Financial reporting is the final product of financial accounting . Providing financial information to different users, either internal or external users of an entity, is done in the form of accounting reports. Those accounting reports that are prepared and presented with the aim of meeting the information needs of external users of an entity are within the scope of financial reporting.
The Conceptual Framework sets out the concepts that underlie the preparation and presentation of financial statements. Its purpose is to assist the accounting standard setters in identifying the concepts which can be continuously used for development and correction of financial

Therefore, the conceptual framework, apart from the standard setters, plays an important role in helping other parties such as preparers and users of financial statements and

In the framework based on decision-usefulness, the main objective of financial reporting is to prepare useful information for economic decisions. Reliable and relevant information, provided that it is cost-benefit, would be desirable. This approach is focused on users of financial reports with emphasis on investors and creditors and their decisions, informational requirements, and ability for analysis and application of information. In the conventional conceptual frameworks of financial reporting that are often based on the approach of decision-usefulness, measurement system is merely monetary and the basis of valuation is the historical cost. Disclosure in this approach leads to financial position reporting, financial performance, and financial flexibility. This framework stresses the behavior of decision-makers in various accounting choices, whether in person or by a group. Individual decision-maker makes use of studying behavior correction using psychological techniques and so on, while group decision-maker takes advantage of securities market research, stock prices, and buying and selling