ACCA FR Syllabus A. The Conceptual And Regulatory Framework - Principles-based and a rules-based framework - Notes ^{3 / 6}

Principles which reflect the initial objectives of financial statements are set

All accounting standards then follow these principles

Therefore, a principles-based framework is based upon a conceptual framework

Rules are laid out as events arise, designed to cover all eventualities

Therefore, accounting standards are a set of rules which companies must follow